If you’re a trader in the United Kingdom or any other EU country that has adopted or vat as a way of collecting taxes then for selling to vat registered traders it seems sensible to sign up for vat. You will be able to give on vat benefits to your customers while also being able to reclaim vat that might already have been paid in another country.
In the United Kingdom you can register as a vat registered trader regardless of whether you are an individual running a business, a partnership, a club, an organization, an association, or other www.vatnumbers.com type of organisation. Basically, if you are dealing in goods or services that attract vat then you can certainly get registered for vat. Additionally, if most of your clients are vat registered dealers then it definitely is a good idea that you continue the vat tax chain and turn into a vat registered dealer.
If your taxable sales go over the vat threshold limit of ?70,000 in the last 12 months then you’re qualified to apply for vat registration. However, you can also volunteer to obtain registered for vat before crossing the threshold limit too. Vat is an efficient way of taxing goods and services to be able to avoid the problem of double taxation and even bring about transparency within the tax system. If you are planning to import services or goods into the UK and then sell them locally then you can also make an application for vat refunds once you turn into an official vat registered trader. You will need to apply at the HM revenue and customs department or hmrc department, which inturn will forward your refund application towards the concerned eu country.
As soon as you register for vat with the hmrc department and turn into an official vat registered dealer then you will need to issue a vat invoice that’s been specified by hmrc. You will need to mention your vat number, vat rate and vat amount on the invoice. UK has 3 kinds of vat rates with the standard rates at 17.5%, reduced vat rates at 5% and zero vat rates. Some products or services having a social impact are usually vat exempt. You’ll first have to check as to which vat rate pertains to each product or service before you begin issuing vat invoices and begin charging the applicable rates.
The vat rules in several eu countries that have adopted vat are slightly different and if you intend to import goods from such countries then you will want to understand much more than simply what exactly is vat. A professional vat agent with sufficient understanding of customs and excise duties which also knows all about uk vat and eu vat rules should be hired for smooth import of products and services into the UK. Once you are a vat registered dealer then you’ll definitely also need to file vat returns at the hmrc specified periods. If you deal in vat exempted goods you will be unable to claim any vat refunds.
The hmrc offers vat registered dealers an opportunity to file their vat returns online itself. Your agent can also file the return on your behalf. However, before you decide to become a part of the vat cycle you have to first register for vat so that you can also enjoy all tax benefits provided by this tax system.