According to the statistics provided by the World Trade Organization (WTO), the United Kingdom takes part in two sorts of international trades; the import and export of merchandise trade and commercial services. Before considering trading internationally you should be aware that the share in the merchandise of trade exports is at about 2.75%, whereas its imports hold a share of 3.64% – so here are some tips to avoid over paying tax.
UK’s overall trading activity
The main destinations or origins of trade include the European Union and a couple of other destinations. As a commercial services trader UK adds 6.77% of exports to the trade of the world, and 4.34% for imports. These statistics clearly indicate that UK is not a top player in world trade, and this gives many enterprises the opportunity to initiate trade more with or from UK.
Nonetheless, there are always various rules to abide by. If you are looking forward to trading with any of the EU members or as an EU member, you have to know the details to VAT very carefully. Many refer to VAT as value-added tax, which is a consumption tax, typically placed on a good whenever the manufacturers add value at a phase of producing it and upon its completion.
If your intention is to initiate trading with a business enterprise that belongs to a member of the EU, you should visit http://ec.europa.eu/taxation_customs/taxation/vat/traders/vat_community/index_en.htm.
Tax Reliefs by HMRC for International Traders
Tax is often imposed on all sorts of products, but oftentimes a relief can be offered as well, except for on contraband products such as alcohol and tobacco etc. HM Revenue & Customs provides detailed accounts of information for business enterprises, which are thinking of inaugurating either imports or exports with businesses present outside their realm of operation.
Small businesses have also been able to request for refunds when visiting other countries or businesses in either UK or an EU-member. VAT holds vital significance in the process of international trade within EU; customs duty is what is accountable for tax impositions outside the EU. As an enterprise planning on expanding or beginning dealings with overseas clients placed outside the EU, one should visit their respective websites.
Trading with the EU
However, as an enterprise wanting to expand or trade only within the European Union, go for VAT registration and keep a track of it, to re-register once the deadline approaches and it expires. It is also important to know that non-EU businesses are often also eligible to apply for a refund of VAT when visiting the UK, or any state of the EU.
It also proves to be extremely helpful and necessary when individuals or whole enterprises go over their international tax planning. Careful tax planning enables one to minimize tax liabilities. For a more information about trading overseas, call London-based accountants Taxaccolega by calling on 08000 235 234 or emailing at firstname.lastname@example.org.