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VAT & VAT Refund

There is a 20 percent Value Added Tax (VAT) in the UK for purchases of most goods and services. There is zero tax for most books, magazines and foods as well as children’s clothes and baby wear. The VAT is included in the sales price and therefore you pay as what you see on the price list. If doing a lot of shopping, the VAT can be a substantial amount of your shopping expenditure. However, international visitors living outside the European Union (EU) can claim VAT refunds for purchasing merchandise but not for hotels and restaurants.

Tax Free Shopping in the UK

Most stores in the UK do not have the facilities to allow international visitors from non-EU countries to claim VAT refunds for purchases. Stores that do provide such service display the ‘Tax-Free Shopping’ sign and usually found in the cities such as London, Manchester and Edinburgh or in areas often frequented by tourists. These designated stores allow such visitors to shop here and then claim some of the VAT initially paid when leaving the EU and not just the UK.

Regent Street shopping district in London by Lewis Clarke

Several websites describe where you can find locations and stores in the UK with facilities for tax-free shopping. Type ‘tax-free shopping store’ and name of the city (such as London, Manchester or Edinburgh) in the search engine to find the relevant websites. Depending on the store, the minimum purchase eligible for a VAT refund is £30 to £50. To apply for a VAT refund, request for the tax-free form from the retailer. Then complete the form and attach the receipts for later processing by UK customs.

Harrods department store in London by Another Believer

Claiming VAT Refund

Before leaving the UK and the EU, go to the customs desk at the airport or seaport to process your claims. A custom official will stamp your form after inspection, which allows you to make a claim – no stamp, no claim! After stamping, go to the refund booth for immediate cash or non-cash payment. At some airports and seaports, drop the form and receipts into a customs post box for processing but will get your refund at a later date You can also send the forms (after stamping by customs) to the retailer or their refund company. They will usually charge a handling fee (deducted from your refund) for making payment.

London Heathrow Airport by Cdogg30

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