Guidance

Claim VAT back on tax-free shopping in the UK (VAT Notice 704/1)

How to get the VAT back on goods you buy in the UK from shops that offer tax-free shopping.

Detail

This notice cancels and replaces Notice 704/1 (January 2012).

1. Overview

This notice tells you how you can get the VAT back on goods you buy in the UK from shops that offer tax-free shopping (also known as the VAT retail export scheme).

The notice is available in:

2. Tax-free shopping

In the UK, VAT is charged on many goods and services. Tax-free shopping means travellers leaving the EU can get a VAT refund on goods they buy here and take home. It cannot be used for services.

In most cases, the shop or refund company will charge you a fee for using tax-free shopping. They’ll take the money out of your VAT refund.

3. Who can use the scheme

If you’re an overseas visitor, you can use the scheme if:

  • your home, or the place you live, is outside the EU
  • you plan to take the goods out of the EU by the last day of the third month after the the month you bought them in (see section 6)

If you’re an overseas resident studying or working in the UK, or a resident of the EU you can use the scheme if you:

  • plan to take the goods out of the EU by the last day of the third month after the the month you bought them in (see section 6)
  • can show that you’ll be staying outside the EU for at least 12 months

If you belong to one of these categories, you must be able to prove this to the shop assistant and to customs when you leave the EU by showing your passport, visa or other documents.

If you cannot prove this when you leave, your claim will not be approved.

4. Using the scheme

You cannot use the scheme for everything you buy. Not all shops offer tax-free shopping. Check before you buy the goods.

You can use tax-free shopping for any goods you’ve paid VAT on except:

  • goods (for example, perfume or chocolates) that you’ve used, or partly used, in the EU
  • motor vehicles and boats
  • goods over £600 in value that will be exported for business purposes (you have to use a form C88 for these)
  • goods that will be exported as freight and goods that need an export licence (except antiques)
  • unmounted gemstones and bullion (over 125 grammes, 2.75 troy ounces or 10 Tolas)
  • mail order goods including Internet sales
  • any services, for example, hotel bills

5. How to shop tax free

Find a shop that offers tax-free shopping. You have to be in the shop yourself when you buy the goods (although somebody else can pay for them).

Tell the shop assistant that you want to use tax-free shopping and show your passport or national ID card.

Ask the shop assistant to explain the scheme to you. Discuss:

  • how the refund will be made
  • when you’ll get it
  • what the charge is, this should be written on your refund form

Make sure that you are allowed to shop tax free (see section 3) and that you understand what you need to do.

The shop assistant will give you the form. Fill in and sign the customer sections of the VAT refund form in the presence of the shop assistant. You must sign the form yourself. The only exception to this rule is for people who cannot sign the form themselves for reasons directly related to disability.

The shop assistant must also fill in and sign the form while you’re in the shop. They may give you a reply paid envelope so you can post the form back after you’ve had it stamped by a customs officer. Take the form (and the envelope) and the goods and all your receipts with you to show to customs when you leave the EU.

You will not get your VAT back if you only have till receipts.

6. When to export the goods

You must export the goods (that is, take them out of the EU with you) by the last day of the third month after the month you buy them in.

For example, if you bought the goods on the 3 February, you would have to export them by the 31 May.

7. What to do when you leave the EU

You must get your form checked and stamped by a customs officer in the EU, you cannot have this done when you get home.

7.1.1 If you’re leaving the UK for a destination outside the EU

Show your goods, till receipts and refund form to a UK customs officer. If you’re going to carry any of the goods in your hold baggage, you must be prepared to show those goods to a customs officer before you check your baggage in, see paragraph 7.2.

7.1.2 If you’re leaving the UK for another EU country

Show your goods, till receipts and refund form to customs in the last EU country you visit. The deadline for exporting the goods stays the same no matter how many countries you visit.

7.1.3 Leaving the UK by air and changing flights in another EU country before leaving the EU

Show your goods, refund form and till receipts to a:

  • UK customs officer before you check in if the goods are in your hold baggage (see paragraph 7.2)
  • customs officer in the last EU country you pass through if the goods are in your hand baggage

7.2 Submitting your claim

Allow plenty of time at the port or airport. There can be long queues to get your VAT refund processed.

At Heathrow airport, to save time, you can get your form checked at a VAT refunds desk before it’s stamped by a customs officer.

Take your goods with the form and receipts to a VAT refunds desk at the airport or port.

Your form must be fully completed. You must hold all receipts for any goods you’re exporting.

If no officer is available, there’ll be a:

  • phone to ring the officer and you will be advised what to do
  • clearly marked customs post box

Post your form (with its unsealed envelope) in the box.

Note that when you show your refund form to the officer, you’re declaring that you’re:

  • eligible to use the scheme
  • exporting all the goods out of the EU

If you cannot prove this, you may miss your flight (or sailing) and customs can take the goods away from you. It’s a serious offence to make a false declaration.

When the officer is satisfied that you’ve met all the conditions of the scheme, they’ll stamp your refund form.

So that they can pay your refund, put the checked and stamped form in the post to either:

  • the shop
  • a commercial refund company

The address will be on the form. If you posted your form in the customs post box, the customs officer will do this for you.

The refund will be made by the way you agreed with the shop (see section 5).

Some companies offer an immediate cash refund. They’ll check your form, keep it and give you a cash refund before you leave the UK. There is a charge for this service.

If you do not get your refund within a reasonable time you should write to the shop. Do not write to HMRC or Border Force.

8. Problems and other circumstances

If you take the goods back to the shop for a full refund or exchange, then you must take your receipts and the VAT refund document with you.

The shop will either:

  • delete the entry for the returned goods
  • cancel the VAT refund document and issue a new one

If you decide to leave behind any of the things you bought under the scheme, you must cross those items off your refund form before you present it, with any remaining goods, to customs.

If you lose your refund form, ask the shop to provide a replacement document. If you find the original later, destroy it.

9. Important things to remember

You and the shop assistant must fill in and sign the VAT refund form when you buy the goods (see section 5).

Give yourself plenty of time when you leave the EU (see section 7).

You must be prepared to show the goods, the till receipts and the VAT refund document to a customs officer when you leave the EU, or you will not get a refund (see step 2 in paragraph 7.2 for what to do if you cannot find a customs officer)

Your refund will probably be reduced by an administration charge (see section 2), make sure you understand how much the charge will be before you buy the goods.

If you do not export the goods by the deadline, you will not get a refund (see section 6).

Your refund form must be checked and stamped in the EU, you cannot have this done in the country you’re travelling to (see section 7).

Your rights and obligations

Read Your Charter to find out what you can expect from HMRC and what we expect from you.

Help us improve this notice

If you have any feedback about this notice please email: customerexperience.indirecttaxes@hmrc.gsi.gov.uk.

You’ll need to include the full title of this notice. Do not include any personal or financial information like your VAT number.

If you need general help with this notice or have another VAT question you should phone our VAT helpline or make a VAT enquiry online.

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If you are still unhappy, find out how to complain to HMRC.

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Published 5 August 2016