In matters of tax eu countries have mostly chosen vat

Introduced first in France in 1954, VAT or value added tax was slowly implemented in most European countries vatcontrol-com
. Within the coming years as well as in matters of tax eu countries have mostly chosen vat is a taxation system that bypasses the possible risks with double taxation while also ensuring better adherence to tax payments.

Most countries around the world usually depended on traditional sales tax systems as a means of collecting revenues through taxes. However, the system wasn't perfect and goods as well as services were taxed several times under this system. Vat is applicable every-time specified goods or services change hands and vat registered traders simply get back the paid tax amount once they issue a vat invoice to their clients and collect the tax back. Regular vat returns make sure that traders provide all vat details to their respective vat departments.

Most eu countries including Denmark, Greece, Sweden, France, Italy, Poland, Germany, Spain, Ireland, Hungary, the UK, Portugal, and Austria, among others have opted to stay with vat while other countries around the globe too have shifted to this process of collecting taxes on products or services. Although vat rules differ slightly in various countries, the majority of them do remain similar in principle to other countries even though vat rates on similar items might differ.

Most eu countries including the UK have 3 basic vat rates that are charged whenever goods or services are traded. The regular rate of vat is what is usually charged on many goods and services, which range from 15-25%. Other goods and services fall into the reduced vat rate of 1-5%, while several others fall under the zero vat rate category. There are also certain vat exempt products or services where no vat is charged and no vat could be claimed either. Each country has its own vat rate classifications where thousands of products or services are segregated according to their vat rates.

Traders that want to adhere to the vat system need to become vat registered traders in their country. This can be achieved by crossing the vat threshold limit set by their country. In this vat tax eu countries too have various threshold limits and traders should appoint a vat agent with good knowledge of eu vat and uk vat rules, especially if they import services or goods from member eu countries into the UK. When a trader gets vat registration then the business will need to issue vat invoices mentioning vat rates clearly as well as file regular vat returns. However, any vat paid in another country may be claimed back by the trader by choosing vat refunds, which in turn would aid in avoiding double taxation and give a cash flow boost for the trader?s business.

Vat continues to be openly welcomed by most eu countries including the UK, and traders can quickly understand the system when they turn into vat registered traders. A professional vat agent on hand can also guide them during calculations and filing of vat returns so as to reclaim any previously paid vat. In matters of tax eu countries have mostly opted for vat and this unified system has helped many traders in such countries to quickly recover previously paid taxes.