If you want to start a new small business in any European country then you should open a small business inside a eu vat state to retain control of your costs. Vat, in principle avoids the pitfalls of double taxation and also if you do find yourself paying vat more than once then you can also apply for a vat refund to recover your hard earned money vat validation.
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 being a method of collecting tax in a transparent manner whilst plugging tax leaks. The method has been largely successful and also this common way 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 any eu vat state or country and begin importing goods into your own country. You will however pay the appropriate customs or excise duties and may also need to pay import vat depending on the classification of the goods. However, once your taxable sales cross the vat threshold limit set by the particular eu country you might need vat registration in becoming a vat registered trader or dealer. This will likely clear the path for you to get your own vat no, charge appropriate vat rates in your vat invoice and also present regular vat returns to your tax authorities. You will now truly be a part of your eu vat system.
However, there are several benefits of staying in the europa vat system. If you have imported goods from a member vat country where vat was already charged you’ll be able to simply fill out the required vat form to claim a vat refund. In case you or your staff have paid vat during trade events or on any other services that attract vat then such vat rates can also be claimed back from that country provided all documentary proof is shown. As you may not in a position to learn almost allin regards to the latest eu vat rules it would be better when you allow an expert vat agent to reclaim vat on your behalf.
Your vat agent also needs to file your vat returns in time as well as make sure that your vat refund applications are handled within time limit. Most countries in Europe which have adopted vat normally have 3 vat rates. The very first is the standard vat rate of about 15 to 25% on many goods. Second is the reduced vat rate of around 1 to 6% on specific goods whilst the third is products which are vat exempt. If you’ve paid vat in another country then this is certainly large amounts, and recovering this amount can certainly reduce your costing and give a much-needed financial injection into your new business vat validation.
Vat is truly an efficient way to make sure that tax leakage is reduced in a very seamless manner. You also should opt for starting a business in a very vat friendly european country whilst importing services or goods from a member country that also follows vat. By setting up a small business in a eu vat state you can certainly retain control of your costs while plugging your own revenue leaks on goods or services where vat was already charged.