Pay import vat when you import goods from eu special territories

If you are importing goods into the UK from specific parts of the globe then you will have to pay import vat when you import goods from eu special territories or even from non eu countries. This tax is collected by the hmrc vat department or the hm revenue and customs department at the port or airport itself and also the goods are then governed by local sales vat rules.

The hmrc has provided for 14,000 classifications of products and services which are governed by customs duties, excise duties and import vat. Most alcohol and tobacco products together with certain activities such as gambling are vat check subject to excise duties while almost all other imports fall under customs duties and import vat according to the goods and also the country from which they arrive.

The hmrc has specified eu special territories where import vat is going to be levied if goods or services are brought in or delivered to such territories. They are The French Overseas Departments of Guadeloupe, The Canary Islands in Spain, The Aland Islands in Finland, French Guiana, Mount Athos and Reunion and Martinique in Greece, and also the Channel Islands in the UK. This vat may also be levied when you import goods from non eu countries.

However, if you are a vat registered trader in the UK then you can apply for a vat refund when you have already paid vat on any goods in the nation of origin itself before being imported into the UK. You can also offset this vat against sales vat when the products which you have imported are sold from our UK market. Countries like the UK and Italy offer special vat deferment schemes where one can get relief from import vat for approximately a month by filing out a unique vat form with the hmrc and opening of an special vat deferment account with them. This move would help protect your cash flow.

Once you start selling your goods or services from your market then you will also have to charge the local sales vat rate to your clients. You will need to make vat invoices that specifically mention vat rates as well as file regular vat returns. For those who have problem in understanding various duties and taxes imposed by the hmrc then you should engage the services of an excellent vat and customs agent. This may enable you to concentrate on expanding your enterprise while all relevant paperwork and payment of taxes and duties is handled in an efficient manner.

The import vat rates are the same as sales vat rates of similar products available in the United Kingdom. The United Kingdom has 3 vat rate slabs. The first is the standard vat rate of 17.5% which is slated to go up to 20% from January 4, 2011. The second is the reduced vat rate of 5% whilst the third is zero vat rate. There are also certain products or services that are totally exempt from any vat.

You should have sufficient knowledge on various duties and taxes applicable on imported goods to the UK to enable you to calculate the charges with an accurate basis. You should use all legal avenues to lower your costs like vat refunds, vat deferments, etc to enable you to lower your costs further and improve the income of your business. You need to diligently pay import vat whenever you import goods from eu special territories or from non eu countries and use the services of an efficient vat agent to claim additional vat back.