If you’re a vat registered trader in the UK then you would have to pay vat on most goods and services but did you know that claiming vat back can improve your business cash flow? In case you have already paid vat once on any services or goods required for your business or paid vat on it even in another eu country then you can definitely make an application for a vat refund.
Most eu countries have adopted the system of vat or value added tax on movement of products and services as a way of collecting more revenue and plugging tax leaks. The UK too has shifted to vat and if you operate a company in Britain then you will have to apply for vat registration when your last 12 month sales turnover touches ?70,000. Being a vat registered trader you will need to pay and collect vat on all purchases and sales in connection with your business depending on the classification of these products or services as per the HM Revenue and Customs or hmrc vat department.
However, in order to avoid double taxation on such goods and services, the hmrc department has established vat rules that will permit you to claim vat back on any services or goods purchased for the business. This amount can be recovered even if you have paid that vat in another eu country that vatnumbersearch.com follows vat, provided you are able to show documentary proof which includes the vat invoice or vat receipt. If you have imported goods into the UK after paying vat in the country of origin or have attended a trade fair inside a foreign eu country where vat has been charged for you then these can be claimed back after you fill the required vat reclaim form.
You should hire a proficient vat agent with complete understanding of uk vat and eu vat rules so that your vat refund claim is passed within the shortest time possible. You will have a time frame of 9 months following the end of the year or so after you had first paid your vat on those services or goods. You can use several online vat services provided by hmrc vat including filing online claims for vat refunds. You will need to register at the hmrc website before you can fill up the required online vat form for vat reclaim. The form will then be sent to the member eu country where you may have paid vat initially, together with scans of vat invoices that you might have to attach to the application.
Once you receive a confirmation usually within 15 days of receipt of the refund claim, it will require around 4 months for your claim to be approved from that member country before you can get your vat back. In the event any additional clarification or documents are needed then you should expect a delay of four more months and hence it is vital to get it right the first time itself. Your vat refund can be deposited in any bank account which you specify within or outside Britain. However, this amount will be in the currency of the nation of origin and will need to be converted into sterling pounds before it can be transferred into your UK bank account.
Although the process to reclaim vat back is a little tedious, an efficient vat agent can apply for vat refunds on your behalf and notify you about the status of your applications. The reality is that claiming vat back can indeed improve your business cash flow by pumping back that double-taxed amount back into your business.