VAT (Value added tax) is an administrative headache for a lot of people. It’s charged by businesses on goods or services at the point of sale, and as it’s a consumption tax, it’s paid by the end customer, rather than the company selling the goods. It can be tedious, complex and time-consuming, and you can incur some heavy costs if you get it wrong.
VAT is levied on most goods and services provided by registered businesses in the UK and some goods and services imported from outside the UK.
How VAT works? You can only charge VAT if your business is registered for VAT. Also, VAT is charged on things that are known as “taxable supplies”. What are these? See below,
- business sales
- loaning goods
- selling business assets
- items sold to staff, such as hot meals in the canteen
- business goods used for personal reasons
- ‘non-sales’, such as gifts and part-exchange.
If you’re a VAT-registered business you must report to HM Revenue and Customs (HMRC) the amount of VAT you’ve charged and the amount of VAT you’ve paid. This is done through your VAT Return which is usually due every 3 months.
If you are an eBay seller then we can help you, if you need a VAT number and need to store some items in the UK to be compliant with HMRC, then we can help.