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Claiming vat back can improve your business income


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

Most eu countries have adopted the system of vat or value added tax on movement of goods and services as a means of collecting more revenue and plugging tax leaks. Great Britain too has moved to vat and when you run vatverification.com a business in Britain then you will need to make an application for vat registration when your last 12 month sales turnover touches ?70,000. As a vat registered trader you will have to pay and collect vat on all purchases and sales related to your business depending on the classification of these goods and services according to the HM Revenue and Customs or hmrc vat department.

However, to prevent double taxation on such services and goods, the hmrc department has established vat rules that will allow you to claim vat back on any services or goods purchased for your business. This amount can be recovered even though 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 nation of origin or have attended a trade fair inside a foreign eu country where vat is charged for you then it may be claimed back as soon as you fill the required 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 limit of 9 months following the end of the year or so after you had first paid your vat on those services or goods. You can 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 fill up the required online vat form for vat reclaim. The form will then be sent to the member eu country in which you might have paid vat initially, along with scans of vat invoices that you might have to attach to the application.

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

Although the process to reclaim vat back is a little tedious, a competent vat agent can apply for vat refunds on your behalf and notify you on the status of your applications. The reality is that claiming vat back can certainly improve your business cash flow by pumping back that double-taxed amount back into your company.