Claiming vat back can improve your business income

If you are a vat registered trader in the UK then you would have to pay vat on most goods and services but did you know that claiming vat back can improve your business income? If you have already paid vat once on any services or goods required for your business or paid vat on it even in another eu country then you can definitely make an application for a vat refund.

Most eu countries have adopted the system of vat or value added tax on movement of products and services as a means of collecting more revenue and plugging tax leaks. Great Britain too has shifted to vat and if you run vatverification.com a company in Britain then you’ll need to make an application for vat registration once your last 12 month sales turnover touches ?70,000. Being a vat registered trader you will need to pay and collect vat on all purchases and sales in connection with your company depending on the classification of these products or services as per the HM Revenue and Customs or hmrc vat department.

However, in order to avoid double taxation on such goods and services, the hmrc department has established vat rules that will permit you to claim vat back on any services or goods purchased for the business. This amount may be recovered even if you have paid that vat in another eu country that follows vat, provided you are able to show documentary proof which includes the vat invoice or vat receipt. In case you have imported goods into the UK after paying vat in the country of origin or have attended a trade fair inside a foreign eu country where vat has been charged for you then these can be claimed back after you fill the necessary vat reclaim form.

You should hire an excellent vat agent with complete understanding of uk vat and eu vat rules so your vat refund claim is passed within the shortest time possible. You’ll have a time frame of 9 months following the end of the year or so once you had first paid your vat on those services or goods. You may use several online vat services offered by hmrc vat including filing online claims for vat refunds. You will need to register on the hmrc website before you can fill up the mandatory online vat form for vat reclaim. The form is then forwarded to the member eu country in which you may have paid vat initially, along with scans of vat invoices that you might have to attach to the application.

Once you receive a confirmation usually within 15 days of receipt of the refund claim, it will take around 4 months for the claim to be approved from that member country before you can get your vat back. In the event any additional clarification or documents are needed then you definitely should expect a delay of four more months and therefore it is vital to have it right the very first time itself. Your vat refund may be deposited in any banking account which you specify within or outside Britain. However, this amount will be in the currency of the nation of origin and will have to be converted into sterling pounds before it can be transferred into your UK bank account.

Although the process to reclaim vat back is a bit tedious, a competent vat agent can apply for vat refunds on your behalf and inform you about the status of your applications. The reality is that claiming vat back can indeed improve your business income by pumping back that double-taxed amount directly into your business.