VAT Registration made easy
At Vathub you will have a representative who can manage all your registrations irrespective of country.
Today, many companies have the entire world as their home market. An increasing number of companies do business that is taxable in another country both within and outside EU. In such cases, VAT registration is necessary according to the law. We can help you with everything from inquiries with regards to the requirement to register for VAT, to the VAT registration itself and the subsequent ongoing accounting work.
By ongoing accounting work we mean tax declarations, periodic compilations and Intrastat reports. Correct VAT registration saves resources, time and money. It guarantees that no financial risks or unforeseen debts will arise that will have to be paid at a later date. Internet sales aimed at private individuals in several different countries is an example of a situation in which VAT registration is a requirement. In certain cases it is also possible to register the company for VAT retroactively.
How we work:
We ask you for all the essential information that the tax authorities in question will ask for.
We will complete the forms that are sent to the tax authorities along with all the other paperwork required.
We will deal with all correspondence with the authorities in question until you have obtained your VAT registration number.
Ask us anything about VAT registration.Contact us now
More about VAT Registration
Do you have to register for VAT abroad? Let Vathub make the enquiries for you.
Here is an example of when VAT registration might be needed:
- Long-term projects in other countries – If a foreign company runs a long-term project in another country, the foreign company may be considered to have established a permanent establishment and may, therefore, have to register for VAT in the country in question
- Local turnover – buying products in another country for the purpose of resale and delivery within that country, does in principle, require VAT registration
- Own warehouse – delivering products to the client’s own warehouse or to a customer’s warehouse may require VAT registration
- Sale to private individuals – VAT registration is required if the company is selling to private individuals in another EU country, provided that the turnover exceeds the country’s threshold.
- E-commerce – VAT-registration is also required if products are sold to private individuals via the internet
- Import – in case of imports to a country where resale takes place both within and outside the country’s borders
- Assembly/installation – in the case of the sale of machinery and structures that are installed on site, VAT registration may be necessary
- Real estate services – work on and services at a foreign property may require VAT registration in the country where that property is located
Do you wish to avoid the stress and worry associated with a VAT audit? Do you want to be 100% certain that your VAT records are accurate and up to date? Let Vathub manage your VAT records and the associated on-going accounting. Our employees have extensive experience with managing the VAT of all kinds of businesses in a variety of countries. We will keep your VAT records straight, regardless of whether your business is small, big, national or international. If you let Vathub manage your VAT you can be sure that no problems will arise during your VAT audit, and furthermore, it will even be possible for your Vathub consultant to be present during the VAT audit, in case the VAT officer has any questions about your VAT records.
One of the main aspects of keeping accurate VAT records is to keep track of input tax which you can claim from countries in which you do business. As an international business with a growing global market, it can be challenging to keep track of foreign VAT legislations and charges, not to mention understanding foreign invoices and handling correspondence with foreign authorities. However, if all these things are done correctly, you can save money, time and resources. If you are unsure whether your VAT record is completely correct and have received notice of an upcoming VAT audit, we will happily check your records prior to the visit.
We offer a very advantageous pricing solution and can handle VAT recovery for all countries. Let us keep your VAT record up to date and you will never have to fear a VAT audit again.
The VAT audit procedure
During a VAT audit, a VAT officer will visit your main premises to go through your VAT records and, if necessary, check your goods and supplies. VAT audits should not be a reason for stress or worry – the VAT officer is simply there to check that you are following the rules, not to unnecessarily fine you or criticize your business. At the end of the VAT audit you will receive a summary of their findings, which may contain suggestions to improve or change your VAT records. A VAT audit should be regarded as a chance to receive free advice and feedback on your VAT records, however if you do have incorrect records or you cannot answer the VAT officer’s questions satisfyingly, you may risk having to pay fines or refunds. If there are certain issues regarding your VAT records that you are unsure of, you should inform the VAT officer in advance, in order to give them a chance to read up on the issue. If your VAT is handled by your accountant or is outsourced to an external consultant, you should ask this person to be present during the VAT audit, unless you are certain that you can answer any questions adequately yourself. Naturally, our Vathub VAT consultants will be happy to be present during a VAT audit, and we will help you implement any changes necessary after the visit.
When VAT registration has been completed, VAT declarations will have to be submitted, and you may occasionally be required to submit periodic compilations and/or Intrastat reports. You can leave the ongoing reporting work to Vathub.
VAT declarations have to be submitted regularly in the country of registration, just as in your home country. We take care of all communications with the host country’s tax authorities, and in close cooperation with your financial department we guarantee that your accounts will be correct.
A report detailing VAT-free sales of products and services within the EU must be accounted for in a periodic compilation. This also applies when products have been transported to your own company within the EU. According to the main rule, this must be submitted monthly for products, and quarterly for services. When selling both products and services, a periodic compilation must be submitted each calendar month.
The EU has developed a system of statistics called Intrastat, in which information is compiled for all imports and exports of products between member states. Intrastat reports can be time-consuming. Leave them to us, and you will have time to focus on the more important parts of your business!
VAT Legislation – European VAT
Any company which provides goods or services that are classified as taxable supplies must be registered for VAT, or Value-Added Tax, provided that its turnover reaches the VAT threshold (for instance £81,000 in the UK). A company must pay VAT in the particular EU member state in which it is based; however as an international company it may be difficult to know which VAT legislation to follow, as each member state has their own VAT regulations, rates and forms. Usually the standard VAT rate in each member state is 15-25%, with reduced VAT rates of around 5-15%, however the VAT legislation in different member states also differs with regards to which goods and services that are charged at the different VAT rates, and which goods and services that are VAT exempt. The EU VAT legislation states that the standard and reduced rates of VAT must be at least 15% and 5%, respectively. Member states can have either one or two reduced rates, and any zero-rated items must be approved by the EU.
Usually, items such as food, children’s clothing and public transport are zero-rated in the UK, whereas in other countries, such as Czech Republic, food and public transport are charged at the reduced VAT rate. Due to these differences, it is imperative that your company is aware of the VAT legislation of the different countries in which you provide or purchase goods and services.
Managing your VAT
In the US, sales tax is charged on goods and services instead of VAT. The rate of sales tax in the US differs by jurisdiction but is usually around 7%. The main difference between sales tax and VAT is that only the end consumer pays sales tax, whereas VAT is paid on the product every time it is purchased by a business in the supply chain. As with the EU VAT legislation, sales tax legislation differs between member states, which have varying tax rates and categories of goods and services. Usually, goods and services that are purchased for resale are exempt from sales tax. Thus, it is possible to evade sales tax by convincing the seller that the product is purchased for resale purposes – a tactic which cannot be used to evade VAT. From the perspective of the tax authority, VAT is therefore a more secure and reliable method of tax collection, accounting for large percentages of state revenues in many EU member states.
As a company, it is possible to reclaim your input tax if it exceeds your output tax, and therefore it is important that you keep a close track of the VAT charged on your purchases, and the VAT charged on the goods and services you provide. It may be necessary for your company to reclaim VAT in several different countries, which means dealing with foreign VAT legislation and foreign documents. Furthermore, you might get requests for receipts or invoices from customers or suppliers abroad. Unless your employees are able to deal with these enquiries, your company may end up losing not only time and money but also credibility.
All businesses in the UK that provide VAT-charged goods and services must be VAT-registered. The VAT which is added to the full purchase price of the goods and services that you provide your customers with is known as output tax. When you buy goods or services for your business, the VAT paid while purchasing these items is known as input tax and can be reclaimed. As you submit your VAT Return, you must state the difference between your input and output tax, and if the amount spent on input tax is higher than the amount spent on output tax, you can reclaim the difference. When calculating your potential VAT reclaim, several forms and guides can be used as help, however different rules may apply in different countries. If the items you purchase are related to any goods or services you sell that are VAT exempt, VAT reclaim will not be possible. If your business provides goods or services that are VAT rated, whether it is at the standard, reduced or zero rate, VAT reclaim should be possible for your input tax. If you are ever in any doubt about which costs are VAT reclaimable, current VAT legislations should be available online for you to consult, although the easiest option may be to get in touch with a VAT expert.
When is VAT reclaim possible?
Although it may sound relatively simple, VAT reclaim is not always straightforward. Many detailed rules must be followed when reclaiming VAT and a number of circumstances must be met. For instance, business expenses are not always eligible for a VAT reclaim, although they may be allowable for Income or Corporate Tax purposes and VAT on business entertainment expenses can normally not be reclaimed.
When reclaiming VAT, the goods and services purchased must be used for business purposes. Any input tax paid on goods or services bought for personal use cannot be reclaimed. Similarly, VAT paid on cars that are not exclusively used for business cannot be reclaimed either.
If your company pays for goods and services to be delivered directly to customers, these VAT charges cannot be reclaimed, and in addition, VAT charges cannot be reclaimed for any art, antiques or second-hand items that your company purchases.
If your company buys goods and services from other EU member states, you will not be able to reclaim this VAT in the UK. Instead, you must direct your VAT reclaim to the VAT authorities of the foreign country. If your company has only recently registered for VAT, it may be possible for you to reclaim VAT on goods and services purchased before your VAT registration.
Usually, your VAT reclaim is paid directly to your bank account, following credibility checks by the relevant VAT authority. In the UK, repayment will usually take less than 10 working days; however, if your VAT Return does not pass the initial credibility check and is subjected to manual investigation, this period may increase. If you have not received your repayment within 30 calendar days, you are entitled to compensation in the form of a repayment supplement.
VAT on e-commerce
Online shopping has become more and more common for many consumers. In order to meet this demand, an increasing number of companies now offer online shops for their customers. Please note that you may have to pay VAT if you are selling products and services to private individuals in other EU countries. This happens when the company has exceeded the turnover threshold for the EU country where the sales took place.
Vathub helps you find out whether your company is registered for VAT or will be required to register for VAT, and helps you deal with this.
Get your VAT under control
As a newly started business there are many things to keep track of regarding your VAT tax. Value Added Tax is paid by all businesses which provide VAT tax-rated goods and services in the EU member states. The VAT tax rules and legislation can be a pain to understand, and it is imperative that you get everything done correctly from the very start. Vathub can help you with all aspects of your VAT management, whether it’s VAT registration, VAT recovery or VAT consulting.
Getting your VAT registration right from the beginning is very important, as it can save you time, money and resources. Firstly, you must find out if your business even needs to be VAT registered. VAT is charged on most goods and services; however some items are exempt from VAT. Even if the goods and services you sell are zero-rated, such as food and children’s clothing, your business must still be VAT registered. The process of VAT registration can be further complicated if your company does business that is taxable in other countries, as they will have different rules and rates for different items. At Vathub we can handle your VAT registration expertly, drawing from many years of experience – ensuring you that no unforeseen debts or financial risks will occur.
Recovering your VAT
As a result of a growing global market, many international businesses face the challenge of multiple foreign VAT invoices and the need to reclaim VAT from countries with a different VAT legislation to your own. Although foreign VAT is dealt with electronically within the EU, the process of VAT recovery may still be complicated by things such as language confusion, local regulations, differing application periods and varying VAT codes. Therefore, VAT management can confuse even the most competent financial department. Our Vathub consultants have extensive experience with VAT legislations of more than 30 countries both within and outside the EU, and can make use of a widespread network of VAT experts locally and globally. Thus, you will only require one Vathub contact for all countries.
In the case that you employ Vathub to handle your VAT recovery, we will first examine and prepare your data for processing, where after we contact the suppliers from which the invoice was issued. We will manage all correspondence with the supplier and any authorities, and if any appeals or reviews occur, we will take full responsibility. After the VAT recovery has been taken care of, Vathub will issue out a financial report for you to keep.
We understand that letting someone gain this much insight into matters that are private to your business requires immense amounts of trust, and therefore you will only find the most experienced and respected consultants, who always work under confidentiality, at Vathub
Prepare for a VAT audit
Naturally, VAT registration and recovery are not the only aspects of VAT management. One of the most important tasks for you as a business is to keep correct and up to date track of all your input and output tax. Some of your input tax may need to be claimed in foreign countries at different rates, and it is thus important that you maintain an overview of the different rules of VAT. If your VAT record is incorrect, you are not only at risk of losing money but it may be regarded by tax authorities as an attempt of tax fraud. In the case of an incorrect or inadequate VAT record, a VAT audit will be a stressful and unpleasant experience. Vathub can handle your on-going VAT management for you, and if you wish, you may have your VAT consultant present during the VAT audit in order to best answer any questions about your VAT record that the VAT officer might have. In the case that the VAT officer has any feedback or suggestions for improvement of your VAT record, Vathub can help you implement these changes efficiently.
Why not let Vathub help you become a VAT expert yourself? You may desire to be independent of external VAT consultants and manage your VAT without any outside help. At Vathub we believe that anyone can become a VAT expert, and we love sharing our expertise and experience. As a result, Vathub offers extensive VAT tax training courses, teaching you all you need to know in order to handle your own VAT management with confidence.