If you're importing goods to the UK from specific parts of the globe then you will need to pay import vat whenever you import goods from eu special territories as well as from non eu countries. This tax is collected by the hmrc vat department or the hm revenue and customs department on the port or airport itself and the items are then subject to local sales vat rules.
The hmrc has provided for 14,000 classifications of goods and services that are governed by customs duties, excise duties and import vat. Most alcohol and cigarettes and tobacco products along with certain activities such as gambling are governed by excise duties while almost every other imports come under customs duties and import vat depending on 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 services or goods are brought in or sent to such territories. Those are the vatcheck.com/vat 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 United Kingdom. This vat may also be levied when you import goods from non eu countries.
However, if you are a vat registered trader in the United Kingdom then you can make application for a vat refund in case you have already paid vat on any goods in the country of origin itself before being imported into the UK. You can also offset this vat against sales vat if the goods that you've 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 up to one 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'll also need to charge any local sales vat rate to your clients. You will have to make vat invoices that specifically mention vat rates and also file regular vat returns. If you have problem in understanding various duties and taxes imposed by the hmrc then you definately should hire the services of a proficient vat and customs agent. This will enable you to focus 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 exactly like sales vat rates of comparable products sold in the UK. The UK has 3 vat rate slabs. The first is the normal vat rate of 17.5% that is slated to rise to 20% from January 4, 2011. Second is the reduced vat rate of 5% whilst the third is zero vat rate. There's also certain goods and services that are totally exempt from any vat.
You should have sufficient knowledge on various duties and taxes applicable on imported goods into the UK so that you can calculate the charges on an accurate basis. You should use all legal avenues to reduce your costs such as vat refunds, vat deferments, etc so that you can reduce your costs further and enhance the income of your respective business. You need to diligently pay import vat whenever you import goods from eu special territories or from non eu countries and employ the services of an efficient vat agent to claim additional vat back.