If you have already paid VAT inside a foreign eu country and have to pay for the same again throughout your home country then you can reclaim vat to lower the load of double vat control taxation. The whole procedure can be completed online, especially if your vat registered business is situated in the United Kingdom where the HM revenue and customs or hmrc department offers several vat online services such as the vat refund scheme that makes reclaiming vat easy.
If you have purchased goods from another vat enabled country within the EU such as Spain, Sweden, Hungary, Poland, Italy, Germany, etc in which you don’t have a vat registered business and have already paid vat in the country of origin then you can certainly and must claim that vat back. This can not just lower product cost but will also allow for vital funds to flow back to your business. Even though the vat reclaiming process usually takes between four to eight months to finish, you can easily appoint a vat agent that’s an expert in eu vat and uk vat refund rules. This should help you to focus on your organization while your agent tries to reclaim vat as your representative by utilizing the online vat refund scheme.
Before you can post your first claim for vat, you will need to become a vat registered trader in the UK and will also need to register for vat refund with the hmrc. You will have a maximum of 9 months following the end of the calendar year for making your vat refund application. Since you can easily complete the online vat form to reclaim any previously paid vat, you won’t have to fill out and dispatch any paperwork but might need to attach scanned copies of vat paid invoices for claims more than a stipulated amount. Some countries may also insist on looking at original invoices that you might have to dispatch to get an effective refund. Again, your vat agent can assist you to complete all necessary formalities.
Many eu countries have their own own version of the vat invoice and have different vat rates for a number of products or services. For instance, Poland requires its vat registered traders to issue a faktura invoice or vat invoice. However, most eu countries do offer some form of vat refunds to avoid the problem of double taxation on goods and services. You simply can’t deduct the vat refund amount in your routine vat returns but will instead have to use the vat refund scheme for the same. In case you have made a vat reclaim within a eu country then you will usually get the refund amount in their currency. You can either transfer the refund amount to a merchant account in the country or directly arrange for the money to be received in your UK bank account by giving them the required details as well as your bank account number.
If you constantly need to import goods or services into the UK where vat was already paid then you should sign up for the vat refund scheme provided by the hmrc vat department. Once you successfully reclaim vat you’ll be able to accurately price your products and services while getting a much needed financial injection in your business.