If you wish to start a fresh business in a European country then you should open a small business in a eu vat state to retain control of your costs. Vat, in principle avoids the pitfalls of double taxation and even if you do end up paying vat more than once then you can certainly also obtain a vat refund to recover your hard earned money vat number.
Through the years many European countries including Hungary, Germany, Greece, Spain, Italy, UK, Sweden, Poland, etc have shifted to vat or value added tax as a method of collecting tax in a transparent manner whilst plugging tax leaks. The process has been largely successful and also this common way of charging tax on goods and services has facilitated smooth imports and exports between countries that form section of the european vat system.
You can begin a new business in a eu vat state or country and start importing goods into your own country. You will however pay the suitable customs or excise duties and might need to pay import vat according to the classification of your goods. However, as soon as your taxable sales cross the vat threshold limit set by the particular eu country then you may need vat registration in becoming a vat registered trader or dealer. This will clear the path to get your own vat no, charge appropriate vat rates in your vat invoice and also present regular vat returns to the tax authorities. You’ll now truly be a part of your eu vat system.
However, there are many advantages of staying in the europa vat system. In case you have imported goods from a member vat country where vat was already charged you’ll be able to simply complete the necessary vat form to claim a vat refund. In case you or your staff have paid vat during trade events or on some other services that attract vat then such vat rates can also be claimed back from that country provided all documentary proof is shown. As you may not able to learn almost allin regards to the latest eu vat rules it would be better when you allow an expert vat agent to reclaim vat in your stead.
Your vat agent should also file your vat returns in time and also ensure that your vat refund applications are handled well within the time limit. Most countries in Europe that have adopted vat usually have 3 vat rates. The very first is the normal vat rate of about 15 to 25% on many goods. The second is the reduced vat rate of about 1 to 6% on specific goods whilst the third is products which are vat exempt. If you have paid vat in a foreign country then this is certainly large amounts, and recovering this amount can certainly lower costing and provide a much-needed financial injection to your new business vat registration.
Vat is really a powerful solution to make sure that tax leakage is reduced in a seamless manner. You too should go for starting a small business in a very vat friendly european country whilst importing goods or services from a member country that also follows vat. By setting up a small business in a eu vat state you are able to certainly retain control over your costs while plugging your revenue leaks on goods or services where vat was already charged.