As a vat registered trader in the UK as in many other eu countries that have adopted VAT or value added tax, you should make sure to file for vat claims to reclaim vat back. If you have purchased goods or services where vat has already been charged, even in another eu country, you can certainly claim that vat amount back to provide a boost to your business cash-flow.
As a business you can claim vat back only on goods and services related to your business and not for your personal use. This vat is known as input tax by the HM Revenue and Customs or hmrc department that handles customs, excise and vat departments in the UK. You can reclaim vat charged irrespective of the rates, be it the standard, reduced or zero rate. However, you will usually not be able to claim vat on vat exempt goods apart from certain exceptions.
Since the process of filing for vat refunds is quite complex and time consuming, especially for goods or services imported from other eu countries, you should use the services of an expert vat agent that is totally acquainted with the latest uk vat and eu vat rules. Several agents will charge a fee based on a percentage of the vat reclaim amount after it has been approved and will not charge any fees if the claim does not materialize. This facility should be accepted by you to avoid paying any money from your pocket to your agent since vat claims usually take between 4 to 8 months to come to a successful conclusion.
You will first need to register yourself online at the hmrc vat website if you want to use all vat services provided by the department. Even if you want to file a vat claim for vat paid in a foreign eu country, you will still need to apply for vat reclaim with hmrc first and also provide all necessary vat documents including vat receipts so that your claim can be processed further. Hmrc will forward your application to the mentioned country and you might also need to send additional documents such as your vat certificate along with the original vat invoice, if desired by that country. If all your documents are found to be in order at the first attempt itself, you could receive your vat refund within 4 months, albeit in the currency of the foreign eu country, which can be converted into sterling pounds when you transfer it to your UK bank account.
Reclaiming vat can provide relief to your business by lowering costs and injecting vital funds into your business. If you regularly participate in trade shows in member eu countries and pay vat in those countries, or import goods into the UK where vat has already been paid then you should opt for vat refunds since this move will lower the cost of your goods while allowing you to legally claim doubly paid tax back from the government.
Once you do turn into a vat registered trader in the UK then you should explore all legal means to recover any tax that has already been paid on goods or services utilized by your business. You need not invest your own time or staff while making vat claims since a capable vat agent can do the same on your behalf and only collect fees when your refund claim is approved.