Open up a small business in a eu vat state to retain control over your costs

If you wish to start a new small business in a European country you then should open up a business inside a eu vat state to retain control over your costs. Vat, in principle avoids the pitfalls of double taxation and also if you do find yourself paying vat more often than once then you can also obtain a vat refund to recoup your hard earned money.

Through the years many European countries including Hungary, Germany, Greece, Spain, Italy, UK, Sweden, Poland, etc have shifted over to vat or value added tax as a way of collecting tax in a transparent manner whilst plugging tax leaks. The method has become largely successful and also this common method of charging tax on goods and services has also facilitated smooth imports and exports between countries that form part of the european vat system.

You can begin a new business in a eu vat state or country and begin importing goods into your own country. You will however be charged the appropriate customs or excise duties and might need to pay import vat depending on the classification of the goods. However, once your vatvalidation taxable sales cross the vat threshold limit set by the particular eu country then you may need vat registration in becoming a vat registered trader or dealer. This will likely clear the path to get your personal vat no, charge appropriate vat rates as part of your vat invoice as well as present regular vat returns to your tax authorities. You will now truly be part of your eu vat system.

However, there are several benefits of remaining in the europa vat system. If you have imported goods originating from a member vat country where vat was already charged then you can simply complete the required vat form to claim a vat refund. Just in case you or your staff have paid vat during trade events or on any other services that attract vat then such vat rates too can be claimed back from that country provided all documentary proof is shown. As you may not be in a position to learn all about the latest eu vat rules it will be better if you allow an expert vat agent to reclaim vat in your stead.

Your vat agent also needs to file your vat returns in time as well as make sure that your vat refund applications are handled well within the time limit. Most countries in Europe that have adopted vat usually have 3 vat rates. The first is the normal vat rate of around 15 to 25% on many goods. Second is the reduced vat rate of around 1 to 6% on specific goods while the third is products which are vat exempt. If you have paid vat in a foreign country then this is probably a large amount, and recovering this amount can certainly reduce your costing and provide a much-needed financial injection to your new business.

Vat is truly an efficient solution to ensure that tax leakage is reduced in a very seamless manner. You also should opt for starting a business in a vat friendly european country whilst importing goods or services from a member country which also follows vat. By opening up a business in a eu vat state you can certainly retain control of your costs while plugging your revenue leaks on goods or services where vat has already been charged.