Claiming vat back can improve your business income

If you are a vat registered trader in the UK then you would need to pay vat on many services and goods but did you know that claiming vat back can enhance your business cash flow? In case you have already paid vat once on any services or goods necessary for your company or paid vat on it in another eu country then you can definitely 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. The UK too has moved to vat and when you run a company in Britain then you will have to make an application for vat registration when your last Twelve month sales turnover touches ?70,000. As a vat registered trader you will have to pay and collect vat on all purchases and sales in connection with your company according to the classification of these goods and services as per the HM Revenue and Customs or hmrc vat department.

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

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

As soon as 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 case any additional clarification or documents are needed then you should expect a delay of 4 more months and hence it is essential to have it right the first time itself. Your vat refund may be deposited in a bank account that you specify within or outside the UK. However, this amount will be in the currency of the country of origin and will need to be converted into sterling pounds before it can be transferred to your UK banking account.

Even though the process to reclaim vat back is a little tedious, an efficient vat agent can apply for vat refunds as your representative and inform you on the status of the applications. The fact is that claiming vat back can indeed improve your business cash flow by pumping back that double-taxed amount directly into your company.