Starting a new business inside of a vat enabled European State or country is only going to bear fruit if 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 costs are 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 vat over the past decade to ensure that trading between such countries proceeds on a common platform. Countries like the UK, Spain, Greece, Italy, Germany, France, Poland, Netherlands, Sweden, and Hungary, among others have adapted vat and many countries in addition have moved to vat check one common currency, i.e. the Euro. This move has facilitated smoother trading between these countries and if you want to start a business in an EU country that has changed to vat then appropriate knowledge of eu vat rules is required for keeping a decent leash on your costs.
Any services or goods that you import in 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 have 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 come up with a vat invoice in your country and charge the applicable vat rates to the customers. You will also have to file regular vat returns based on your sales and purchases.
However, if you’re based in any european country that follows vat system and have imported goods to your country where vat was already 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 your vat refund in the original country. In the event you or your workers have attended trade shows or paid vat on any other services overseas, you’ll be able to still apply for a vat reclaim to recover the amount of vat paid.
The eu vat rates various eu countries range between 15 to 25%, while special vat rates on certain goods and services range from 1 to 6%. There are also certain products which are vat exempt. These rates can easily make a big difference in the product costs and if you are able to recover any tax which has previously been paid then this can make a positive impact on your enterprise bottom-line. An experienced and trusted vat agent can surely help you. You should seek out a broker that only takes fees or commissions from vat amounts recovered instead of charging a set fee.
Many countries in Europe have opted for a uniform tax system on goods and services, and this is great news if you plan to begin a whole new business in that country. Your costing process becomes simpler and you’ll surely be able to recover vat amounts that have been charged previously. However, you need to surely confirm all european vat rules before importing goods into an EU State in order to defend your fledgling business from the financial shocks.