VATRESNI4300 - Control at export - airports and ports: Export control procedures

Commercial exports

The VAT Retail Export Scheme (Northern Ireland) may be used for goods for commercial or business purposes only where a customs declaration is not required. See guidance at Taking commercial goods out of Northern Ireland in your baggage. Where the conditions for the VAT Retail Export Scheme are met, the VAT refund document may be certified. However, the customs officer should advise the traveller to use standard commercial export procedures for any future shipments.

For commercial / business exports requiring a customs declaration, the VAT retail export scheme cannot be used. See Merchandise In Baggage (MIB) procedures in VEXP, Notice 6 and Notice 703. Information on the customs control of commercial goods carried in passengers’ baggage is provided in Border Force Handbook.

Certification of VAT refund documents

Under EU law, UK Customs (in Northern Ireland) is required to certify the VAT refund documents to evidence exports by non-EU visitors and entitled EU travellers going directly from Northern Ireland to a final destination outside the EU (including GB). Those travellers departing the EU via an EU exit point must have their VAT refund documents certified in the Member State of final departure.

Northern Ireland VAT refund documents will only be certified in Northern Ireland where this is the final point of exit from the EU or the goods are exported as hold baggage. Where departure from the EU is via an EU exit point the VAT refund document will be certified in that Member State.

Forms issued in EU Member States

Since forms are only verified when the customer leaves the EU, there will be instances where UK customs officers in Northern Ireland are presented with forms originating from EU member-states. Although the VAT retail export scheme is operated on a similar basis across the EU, details of procedures may differ in each country. VAT retail export scheme forms from EU member- states should however be processed as far as possible in the same way as Northern Ireland forms on exit from Northern Ireland.

Verification and processing of VAT refund documents

Where customs officers are satisfied that all the goods are available and all the conditions have been met, the VAT refund document will be certified.

Travellers who are accorded special VIP facilities are treated separately at the place of departure (see VIP Procedures below), but such persons must still meet the conditions of the scheme.

Certified VAT refund documents should be returned to the traveller and (if a cash refund has not already been paid) he should be advised to post the form back to the retailer or refund company to arrange payment of the refund. (Most refund companies will provide a self-addressed envelope for the traveller). Some travellers choose to post the certified document in the UK; others prefer to take a photocopy before posting it back from their final destination.

Drop boxes

Most Northern Ireland exit points have drop boxes for VAT refund documents. Some offer phone access to request a Customs officer for certification as travellers with high value claims want assurance that their claim has been accepted. Refund documents left in drop boxes are posted by Customs to the originating retailer or refund company in self-addressed envelopes which should have been provided by the claimant.

Forms left in drop boxes should be checked carefully to ensure they are fully and accurately completed. Claimants must have provided evidence of destination. In the absence of such evidence, the presumption will be that the goods moved to Great Britain. A lack of evidence needs to be clearly conveyed to the retailer/refund company. It has been agreed that in situations where it is known that goods will be imported into Great Britain, Customs officers in Northern Ireland will endorse claims with “Goods removed to GB, Import VAT to be accounted for”. This will make it clear to the retailer that they must account for output tax before paying the claim.

Particular attention should be paid to high value purchases. If you have any doubts about the veracity of such claims, consider writing to the overseas passenger and requesting evidence that the goods have been imported into the traveller's home country. Details from forms left in drop boxes should be recorded and the following information should be included:

  • date;
  • passenger name;
  • nationality;
  • retailer;
  • goods;
  • value (including VAT);
  • comments;
  • evidence of destination; and
  • officer’s name.

A short letter should be issued to the traveller explaining why any form has been rejected (see example at VATRESNI8600).

VIP procedures

People may be treated as VIPs under diplomatic arrangements, or because of fame, wealth or notoriety by airport and port authorities. These travellers by-pass the usual check-in arrangements and do not leave from international departure lounges. Often an entourage accompanies VIPs.

Many VIPs purchase goods under the VAT Retail Export Scheme and wish to claim a refund of VAT. Suitable arrangements for the certification of VAT refund documents by a customs officer should be agreed with the airport or port authorities. In the absence of suspicion, the customs officers may make selective checks in accordance with local schemes of control.

Normal VAT retail export scheme conditions apply but, depending on the VIP, the customs officer may authorise the production of the VAT refund document and any goods required for examination to be produced by an aide or personal assistant. Normal rules apply to the aide / personal assistant’s own purchases.

Incomplete and out of date documents

Documents that are not completed in full can be rejected. It is the responsibility of the retailer to ensure the customer section is fully completed and signed before the retailer’s declaration is signed.

However, at the time of departure, in the absence of suspicion the Customs officer may allow the customer to sign the customer’s declaration. Where the retailer has not signed, again in the absence of suspicion, the officer may certify the form and endorse it “retailer’s declaration not signed - document certified without prejudice”. The document will, in these circumstances, be returned to the customer.

If a traveller presents the wrong form or an out-of-date version of the form  the Customs officer will certify it if satisfied that the traveller is entitled to use the scheme and the goods are eligible.

A letter should then be sent to the retailer drawing his attention to incorrect procedures or out-of-date forms used. VATRESNI8000 provides a standard letter to be sent to the retailer.

Forms rejected by Customs

Goods must be exported from Northern Ireland and the EU to qualify for zero-rating. Before export they must be made available to a Customs officer for examination if required. Where the customs officer is not satisfied that:

  • the traveller is exporting the goods,
  • the goods are being exported within the time limits,
  • the goods are those described on the refund form, or
  • the traveller is entitled to use the scheme.

The officer should:  

  • endorse the VAT refund document “Traveller not entitled [giving reason] - zero-rating not authorised”;
  • tell the traveller why the refund has been disallowed;
  • record the details of the claim and why it has been disallowed and, using best judgement, either
  • retain the document in case of future enquires; or
  • if fraud is suspected, send the VAT refund document to the VAT officer for the retailer concerned providing full details of concern; or
  • send a photocopy of the rejected document back to the retailer for informational purposes, as referenced Section VATRESNI 8000. Including a photocopy of the receipt could assist in identifying the staff member involved and provide the trader with relevant information to address any future customer enquiries.

Appeal against rejection

Customs officers should follow normal Border Force procedures for dealing with appeals and reviews of decisions to reject Retail Export Scheme claim forms.

HMRC considers there is not a general right of appeal to a VAT Tribunal, regarding the decision not to stamp a form, under the VAT Act. The decision in Chhabria and others TC2016.04286, which is a non-binding decision of the Tribunal, does not change that interpretation. The recommended course for challenging a decision not to stamp is to pursue a Judicial Review.

The Retail UoE should be informed when Border Force become aware of any appeals or Judicial reviews lodged with the tribunal or courts.

VAT not charged

When customs officers observe that goods have been sold at the tax-exclusive price and a refund of VAT is not appropriate because, for example, the passenger is a not an entitled person, the process for rejected forms outlined above should be followed.

Time limits for export

Travellers who wish to reclaim VAT must ensure the VAT refund documents are produced to Northern Ireland or EU Customs for stamping and the goods are made available for examination if required by the last day of the 3rd month following the month of purchase e.g. goods purchased on 1 January must be exported by 30 April.

In rare cases where this is not possible, for example where a traveller is too ill to present the VAT refund document. Where evidence (such as a doctor’s certificate) is provided, the Customs officer may specifically authorise the delayed certification on the form. This procedure is high-risk and must be used exceptionally and with extreme caution.

Documents sent to Customs

Some travellers who have reached their destination may send invoices or receipts to Customs at the port / airport of departure for certification under the scheme. This is not acceptable. You should report any case that you cannot deal with to the Retail UoE.

Alternative evidence of export

Forms stamped after the traveller has left the EU/Northern Ireland are not acceptable unless exceptional circumstances exist. You should report any case you cannot deal with to the Retail UoE.

Offence action

Under section 167 of the Customs and Excise Management Act 1979, Customs staff at departure points can take offence action against a traveller who has deliberately tried to misuse the VAT retail export scheme.