In case you have crossed the threshold limit or wish to be a part of the vat or value added tax system then you’ll need to make an application for registration for vat to turn into a vat registered trader. Once you turn into a vat registered trader you will then be empowered to reclaim vat paid in another eu country and thereby lower your costs as well as enhance your business cash flow.
Several eu countries like the UK, Spain, Poland, Sweden, Italy, Germany, etc have moved over to vat for taxing products or services. Vat is thus followed even while trading between member eu vatvalidation.com countries. If you have started a new business in the UK and also have touched ?70,000 pounds in taxable sales in the past 12 months then you can definitely make an application for vat registration with the HM Revenue and Customs or hmrc department. You can even apply before this threshold limit is achieved if you sell your goods or services to mostly vat registered traders. Vat registration can be achieved as an individual, partnership, company, trust, etc as deemed fit by the hmrc department.
However, as soon as you apply for vat registration then your costs could increase slightly, and if you sell your goods and services locally in the United Kingdom at the retail level then you could opt to remain outside vat should you only sell vat exempt goods. However, if you try to artificially try to separate your enterprise activities simply to remain outside the system of vat then this hmrc vat department might not take your actions lightly in case you are discovered doing the same. There are many advantages of entering the vat system since it will prevents the problem of double taxation by permitting you to definitely reclaim vat already paid on services or goods overseas too.
The whole process for registration for vat is pretty simple but if you are not sure about yourself then you should simply appoint an expert vat agent to deal with all vat matters. The hmrc vat department offers several vat online services including applications for registration for vat. You are able to make an application for vat through your vat agent too provided you inform the department of your choice. Once you make an application for vat registration then this process of approving the application usually takes between 10 to 30 days. Fo the time being you can keep issuing regular invoices to your clients. However, in that period you will have to take into account applicable vat rates and re-issue those invoices issued after your application so your clients can reclaim vat from their end.
As soon as your application is approved then you will receive your distinct vat registration number and may need to display it on all vat documents including your vat invoices, vat returns, and vat refunds. You will also have to issue a vat invoice that separately shows all vat rates applied in the invoice together with your vat no at the top. You will have to give a summary of all vat paid and collected in your vat returns which will have to be filed periodically as required by the hmrc vat department. If you have already paid vat on goods and services in another eu country then you can try for vat reclaim once you’re an official vat registered trader.
Vat registration is a straightforward online procedure that needs to be done first if you want to turn into a vat registered trader in the UK. You can simply fill up the online vat registration form and submit it to your hmrc vat department whenever you apply for registration for vat.