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 apply for registration for vat to turn into a vat registered trader http://vatcheck.com. When you finally are a vat registered trader you will then be empowered to reclaim vat paid in another eu country and thereby lower your costs and also enhance your business earnings.
Several eu countries like the UK, Spain, Poland, Sweden, Italy, Germany, etc have moved over to vat for taxing goods and services. Vat is thus followed even while trading between member eu countries. If you have started a new business in the United Kingdom and have touched ?70,000 pounds in taxable sales in the past 12 months then you can apply for vat registration with the HM Revenue and Customs or hmrc department. You may also apply before threshold limit is achieved if you sell your goods or services to mostly vat registered traders. Vat registration can be achieved as being an individual, partnership, company, trust, etc as deemed fit by the hmrc department.
However, as soon as you apply for vat registration your costs could increase slightly, and if you sell your products or services locally in the UK at a retail level then you could choose to remain outside vat if you only sell vat exempt goods. However, if you try to artificially make an effort to separate your business activities only 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 as it will avoid the problem of double taxation by allowing you to reclaim vat already paid on services or goods in another country too.
The whole process for registration for vat is pretty simple however, if you aren’t sure about yourself then you should simply appoint an expert vat agent to handle all vat matters. The hmrc vat department offers several vat online services including applications for registration for vat. You can make an application for vat through your vat agent too provided you inform the department of your choosing. As soon as you apply for vat registration then the process of approving the application usually takes between 10 to 30 days. Until then you can continue issuing regular invoices to your clients. However, in that period you will need to factor in applicable vat rates and re-issue those invoices issued after your application so that your clients can reclaim vat from other end.
As soon as your application is approved then you will receive your distinct vat registration number and will have 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 that invoice together with your vat no at the very top. You will need to give a breakdown of all vat paid and collected in your vat returns that will have to be filed periodically as required by the hmrc vat department. In case you have already paid vat on goods and services in another eu country then you can apply for vat reclaim once you are an official vat registered trader.
Vat registration is a simple online process that needs to be done first if you want to turn into a vat registered trader in the UK. You can easily fill up the online vat registration form and submit it to the hmrc vat department when you make an application for registration for vat.