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 cost is kept at the very least and that the problem of double taxation doesn’t 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 such as the UK, Spain, Greece, Italy, Germany, France, Poland, Netherlands, Sweden, and Hungary, among others have adapted vat and many countries have also shifted to a common currency, i.e. the Euro. This move has facilitated smoother trading between these countries if you would like to start a business in an EU country which has changed to vat then appropriate comprehension of eu vat rules is required to keep a tight leash on your costs.
Any services or goods that you import in your country will attract customs or excise duties or even import vat, based on its classification. To be able to charge vat to the customers, you’ll need to turn into a vat registered dealer, which can be done once you cross the vat threshold in taxable sales. Now you can make a vat invoice in your country and charge the applicable vat rates to the customers. Additionally, you will have to file regular vat returns determined by the sales and purchases.
However, if you’re located in any european country that follows vat system and have imported goods into your country where vat has already been paid in the original country or used services in a country where vat may be paid you’ll be able to reclaim the vat amount. You can claim vat amount on goods where vat has already been paid by applying for your vat refund inside the original country. In case you or your workers have attended trade events or paid vat on any other services in another country, then you can still file for a vat reclaim to recuperate the quantity of vat paid.
The european vat rates various eu countries range between 15 to 25%, while special vat rates on certain goods and services vary from 1 to 6%. There’s also certain products which are vat exempt. These rates can easily make a big difference in your product costs and when you can recover any tax which has previously been paid then this can easily make a positive impact on your business bottom-line. A professional and trusted vat agent can surely help you. Make sure you look for an agent 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 start a new business in that country. Your costing process will become simpler and you will surely have the ability to recover vat amounts that have already 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.