The VAT number (Value Added Tax) is an analogue of our VAT. It is applied to companies from EU countries when conducting business between them. The rate of this tax usually ranges from 17% -25% depending on the country where it is applied. It is this number that residents of EU countries must have and indicate when conducting commercial operations.
Companies with a VAT tax number from an EU member state are exempted from this tax. For example, if a British company buys something from a German company, then the latter should increase the value of its product by the VAT rate if the buyer does not have a VAT number. But if a British company has such a number, it can purchase German goods without paying this tax. Of course, this is primarily beneficial to organizations buying goods in the EU. To obtain a VAT number, a company must first select an auditor who will be the official “VAT representative” of the company. This auditor will be responsible for the actions of the company where the VAT number was used. He should have information about the invoices received and issued and compile quarterly reports on all the actions of such a company.
By receiving a VAT number, the organization automatically registers itself in the tax authorities of the country of registration as a company operating, therefore, it is obliged to regularly draw up and submit financial reports on its activities. The company must also pay taxes on its profits according to tax rates for the reporting period. If you entrust your business to a competent specialist, then the amount paid in the form of taxes can be legally reduced.
More information - https://en.wikipedia.org/wiki/Value-added_tax
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