If you’re a vat registered trader in the UK then you can steer clear of the problem of double taxation on services utilized from foreign companies whenever you claim reverse charge vat on services where vat was already paid. This vat procedure allows you to first pay vat and after that cancel it so that your net cost does not increase.
If you’re a trader which uses services of foreign companies, particularly those located in vat-friendly eu countries then you certainly may have already paid vat in those countries. On the other hand, you may also www.vatnumbersearch.com have received such services in the UK itself from a supplier situated in a eu country. Every one of these factors would turn out increasing your expenses as you might end up paying vat on certain services including those linked to land, property, intra EC-freight services, and other such services as defined by the HM Revenue and Customs or hmrc department along with the European Community simplification regulations.
In case you have a lttle bit difficulty in interpreting these vat rules you then should enrol the expertise of a good customs and excise customs vat agent with a wide reach in most eu countries that practise vat. Such an agent would surely understand all uk vat and eu vat regulations and could enable you to claim reverse charge vat that might have been paid to a foreign company situated in another country including a vat-friendly eu country.
You can reclaim vat already paid for specified services while filing your vat returns itself. If you’re in Britain then you will need to calculate and indicate how much paid in Box 1 of the vat return form. You will then have to specify exactly the same amount in Box 4 of that return to ensure the amount stands cancelled. You’ll have to specify the total quantity of the provision in Box 6 and 7 of the vat return form so as to complete your reverse charge vat claim. However, you will have to convert the currency of any vat paid in a foreign country to sterling before you decide to fill out the amounts in those boxes.
This reverse charge process can also be known as tax shift and you can go for such a vat reclaim only if you are a vat registered trader in the UK. In order to become a vat registered trader, your taxable sales need to cross over ?70,000 in the previous 12 months while you can even apply before vat threshold amount may be achieved. As soon as you start charging vat to your customers and file regular vat returns then any services rendered by you a foreign company can be reclaimed back in future vat returns, provided you follow all necessary guidelines issued by hmrc vat department.
Although following vat rules usually are not very difficult, it is always better to choose services of proficient vat agent that can handle all of your vat requirements seamlessly. This will allow you to concentrate on increasing your business while your vat agent files for reverse charge vat and recovers your taxes which may have already been paid for services rendered by way of a foreign company within or outside the UK.