Claiming vat back can improve your business cash flow

If you are a vat registered trader in the UK you would then need to pay vat on many services and goods but are you aware that claiming vat back can enhance your business cash flow? In case you have already paid vat once on any goods or services necessary for your company or paid vat on it even in another eu country then you can definitely submit an application for a vat refund.

Most eu countries now utilize 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 operate a company in Britain then you’ll have to apply for vat registration once your last 12 month sales turnover touches ?70,000. Being a vat registered trader you will need to pay and collect vat on all purchases and sales in connection with your company according to 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 goods and services, the hmrc department has established vat rules that will allow you to definitely claim vat back on any goods or services purchased for the business https://vatcontrol.com/vat. This amount may be recovered even if you have paid that vat in another eu country that follows vat, provided you can 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 country 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 up the necessary vat reclaim form.

You should hire a proficient vat agent with complete understanding of uk vat and eu vat rules so that your vat refund claim is passed in the shortest time possible. You’ll have a time frame of 9 months after the end of the calendar year after you had first paid your vat on those goods or services learn more. You may use several online vat services offered 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 required online vat form for vat reclaim. The form will then be sent to the member eu country in which you may have paid vat initially, along with scans of vat invoices which you may need to attach to your application.

Once you receive a confirmation usually within 15 days of receipt of your refund claim, it will require around 4 months for your claim to be approved from that member country before you can get your vat back. In the event any additional clarification or documents are required then you definitely should expect a delay of four more months and hence it is vital to have it right the first time itself. Your vat refund may be deposited in any banking account which 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 prior to it being transferred to your UK banking account.

Although the process to reclaim vat back is a bit tedious, a competent vat agent can apply for vat refunds as your representative and notify you on the status of the applications. The reality is that claiming vat back can indeed improve your business income by pumping back that double-taxed amount directly into your business.