If you have already paid VAT in a foreign eu country and also have to pay for the same again in your own country then you can reclaim vat to lower the burden of double checkvatnumber taxation. The whole procedure can be completed online, especially if your vat registered organization is located in the United Kingdom where the HM revenue and customs or hmrc department offers several vat online services such as the vat refund scheme which makes reclaiming vat an easy process.
In case you have purchased goods from another vat enabled country in the EU such as Spain, Sweden, Hungary, Poland, Italy, Germany, etc where you don’t have a vat registered business and have already paid vat in the country of origin then you can and should claim that vat back. This will not only lower product cost but also allow for vital funds to circulate back into your business. Even though the vat reclaiming process usually takes between four to 8 months to complete, you can simply appoint a vat agent that is a specialist in eu vat and uk vat refund rules. This will help you to focus on your business while your agent tries to reclaim vat as your representative by utilizing the online vat refund scheme.
Before you post the first claim for vat, you will need to be a vat registered trader in the UK and will also have to sign up for vat refund with the hmrc. You’ll have maximum of 9 months after the end of a year or so to make your vat refund application. Since you can easily complete the web based vat form to reclaim any previously paid vat, you won’t have to complete and dispatch any paperwork but should attach scanned copies of vat paid invoices for claims more than a stipulated amount. Some countries may also insist upon looking at original invoices that you might have to dispatch to get an effective refund. Again, your vat agent can assist you to complete all necessary formalities.
Many eu countries have their own own version of a vat invoice and have different vat rates for various goods and services. For instance, Poland requires its vat registered traders to issue a faktura invoice or vat invoice. However, most eu countries do offer some kind of vat refunds to avoid the problem of double taxation on products or services. You cannot deduct the vat refund amount in your routine vat returns but will instead need to use the vat refund scheme for the same. If you have made a vat reclaim in a eu country then you will usually receive the refund amount in their currency. You can either transfer the refund figure to an account in the country or directly arrange for the money to generally be received in your UK bank account by giving them the necessary details including your bank account number.
In case you constantly have to import goods or services into the UK where vat has already been paid you then should sign up for the vat refund scheme provided by the hmrc vat department. Once you successfully reclaim vat you’ll be able to accurately price your products and services while getting a much needed financial injection in your business.