Saturday, February 22, 2014

Getting your VAT back

How to collect a tax refund after visiting London

by Mark Fitzgerald
The tax system used in London is known as a value added tax or VAT.  Instead of adding on sales tax to the purchase after the purchase it is incorporated into the marked price.  In London it is upwards of 20%.  And you thought New York was bad.  Well there is some good news in that you can apply to get that tax back.  Sort of.

To shop tax free you have to buy something you plan on consuming outside of the country.  That means any service, such a restaurant or tourist attraction doesn't count and you can't apply to get it back.  You can't county something you buy and use in the country, such as a box of chocolates.  So in the end this ends up being mostly souvenirs that you can claim.

And then it isn't easy to apply to get your money back.  First you need to request paperwork in the store you buy your merchandise.  After the paperwork is filled out you and the store need to sign the papers and you will have to show them your passport (which will mean you would need to be carrying your passport). Stores do not need to participate either.  Harrods for example requires travelers to spend £50 or more to apply for a refund.

Once you get to the airport you can take all of the merchandise you bought, receipts and paperwork and bring it the customs desk. They will collect it and you will get either a cash refund or a return on your credit card 3 weeks later. You can also take it to a number of other locations, such a money changing operation.  The refund company will charge you a fee for using Tax Free Shopping. They will take the money out of your VAT refund.  If you plan on doing this make sure you get to the airport at least 30 minutes earlier than planned.

No comments:

Post a Comment