POSTPONED VAT ACCOUNTING AND CASH FLOW BENEFIT
If UK VAT register business import goods outside UK, there are normally VAT charges at same rate. This VAT can be paid at port on importation (if you choose) and you claim it back this VAT on your VAT return as Input VAT. Alternatively, UK business can account for VAT on their VAT return by using Postponed VAT accounting. Postponed VAT accounting was introduced in January 2021 to allow UK VAT registered importers to account for and recover import VAT on the same VAT return, subject to the normal rules on input tax deduction. Postponed VAT accounting is available permanently and it will provide significant cash flow benefits compared to the alternative of paying the import VAT when the goods are imported.
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