The standard VAT (value added tax) rate in the UK is 20%. This is applied to most items, apart from those that are tax-free (most food, books, newspapers and magazines, children’s clothing, and other exempt items) and children’s car seats, which are subject to 5% VAT.
This tax is usually included in the price of items when you’re shopping in the UK, unlike some other countries where it may be added at the till.
If you’re not a UK resident, you may be able to buy items without paying this tax, essentially giving you a 20% discount on your shopping. Read on to find out more.
Who Can Shop Tax Free in the UK?
There are two groups of people who are eligible for a tax refund for goods bought in the UK:
> Residents of non-EU countries
> Residents of an EU country who will be leaving the UK for a destination outside the EU up to three months after the month you bought the items
> You must stay outside the EU for at least 12 months to be eligible for tax-free goods.
How to Claim a Tax Refund
As VAT is combined with the normal sale price for most goods in the UK, it’s not normally possible to avoid paying the tax at time of purchase. Instead you’ll need to claim a tax refund.
You can claim a tax refund on shopping you’ve done in the UK provided you’re eligible and your purchases are at least £30.
You’ll need to fill out a tax free form for your purchases and have the form validated by customs when you leave the UK. You’ll need to keep your receipts and have your items available for inspection.
Retailers offering tax-free shopping with Global Blue will provide you with a refund form. These include Bicester Village and Harrods in London.
Once your form has been validated and stamped, go to a Global Blue claim office in the airport (this may be at a currency exchange counter – look for the Global Blue logo) and present your form to receive your refund as cash or to your credit card. You can also use the Global Blue mailboxes that are located close to most customs offices to mail your form and have your refund applied to your credit card.
The refund amount will be the value of the VAT minus Global Blue’s service fee.
Global Blue refund counters can be found in Gatwick, Heathrow, and Manchester airport as well as several other locations in London and other major UK cities. A full list of refund locations can be found here.
Refunds must be claimed within three months of buying goods.
Some items are not eligible for a VAT refund. These include:
> Non-Refundable Goods
> VAT-free items
> New or used cars
> A boat that will be sailed outside the EU
> Goods worth over £600 that you’re exporting for a business
> Goods exported as freight
> Goods that need an export license, except antiques
> Unmounted gemstones
> Bullion over 125g
> Mail order items and internet sales
> Goods used in the EU such as perfume
> Service charges