Starting a new business venture inside of a vat enabled European State or country is only going to bear fruit should you confirm all european vat rules before importing goods into that EU State. This move will help you to legally exploit all avenues to ensure that your cost is kept at the very least and therefore the issue of double taxation does not eat into your profits.
Several EU countries have embraced vat or value added tax in the last decade to ensure that trading between such countries proceeds on a common platform. Countries such as the UK, Spain, Greece, Italy, Germany, France, Poland, Netherlands, Sweden, and Hungary, amongst others have adapted vat and many countries in addition have shifted to a common currency, i.e. the Euro. This move has facilitated smoother trading between these countries and if you would like to start a business in an EU country which has changed to vat then appropriate comprehension of eu vat rules is mandatory for keeping a tight leash on your costs vat validation.
Any goods or services that you import into your country will attract customs or excise duties as well as import vat, based on its classification. In order to charge vat to your customers, you’ll need to turn into a vat registered dealer, which may be done as soon as you cross the vat threshold in taxable sales. You can now make a vat invoice in your country and charge the applicable vat rates to the customers. You will also have to file regular vat returns determined by the sales and purchases.
However, if you are located in any european country that follows vat system and have imported goods to your country where vat has already been paid in the original country or used services in a country where vat has been paid then you can reclaim the vat amount. You can claim vat amount on goods where vat has already been paid by applying for a vat refund in the original country. In the event you or your employees have attended trade events or paid vat on any other services in another country, then you can still file for a vat reclaim to recuperate the quantity of vat paid.
The eu vat rates various eu countries range from 15 to 25%, while special vat rates on certain goods and services range from 1 to 6%. There’s also certain products which are vat exempt. These rates can easily make a big difference in the product costs and when you can recover any tax which has already been paid this can make a positive influence on your enterprise bottom-line. A professional and trusted vat agent can surely help you. Make sure you seek out a broker that only takes fees or commissions from vat amounts recovered rather than charging a set fee vat validation.
Many countries in Europe have opted for a uniform tax system on goods and services, which is good news if you intend to begin a whole new business in that country. Your costing process will become simpler and you will surely have the ability to recover vat amounts which may have been charged previously. However, you should surely confirm all european vat rules before importing goods into an EU State in order to defend your fledgling business from the financial shocks.