UK Value Added Tax (VAT) Refunds for Visitors

In 2005 my wife and I travelled to London and Paris. Back in the days of disposable income we made a few purchases that qualified for a VAT refund, but never did find the right customs agent at the airports to process the request. While I’m not sure that we will be purchasing anything of real value to bring home with us this time, I want to make sure that I know what to do in the event that we find a must have item. This could save a lot of money because the VAT in the UK is up to 20% as of this year.

For starters, I headed over to the official HM Revenue and Customs page for visitors to the UK. It seems simple enough – anything purchased from a participating retailer is eligible for a refund with the exception of:

  • new or used cars
  • a boat you plan to sail outside the EU
  • goods worth more than £600 exported for business purposes
  • goods to be exported as freight
  • goods that need an export licence – except antiques
  • unmounted gemstones
  • bullion over 125g, 2.75 troy ounces or ten Tolas
  • mail order goods, including Internet sales
  • goods used or partly used in the EU, such as perfume
  • service charges, such as hotel expenses

Now we just have to make sure that any large purchases are made a participating retailers, those who are willing to process the refund forms. According to Visit London, participating stores get to decide what your minimum purchase must be before they go through the trouble dealing with these forms and they typically require a purchase of at least £75. Not only do they have to supply the forms, they often will help you to fill them out and then have to deal with some back-end processes with customs. £75 seems like a pretty high requirement, but given the hassle for the store to process the refund and for you to claim the refund, it makes sense that they only go through with it if it is worth your while. Also remember, it’s really not in the best financial interest of UK citizens and businesses to give tourists their taxes back, so they aren’t exactly motivated to make this easy on us!

Now for the part that got us hung up in 2005: How exactly do you get your refund? I know that there is supposed to be a customs desk at the airport, but I’d like to figure out where exactly they are and how long I should allow to go through the refund validation process.

Finding the actual locations of the customs desks was not simple, but the terminal mapsof Heathrow does list VAT Returns in Terminal 1. The general consensus is that you should allow for 1 hour in line to get processed. That doesn’t sound too bad given that you are supposed to arrive 3 hours early for international flights, but the trick is that you are supposed to physically have the goods with you to show the customs agent. If you plan on putting the goods in checked luggage that means you must go through this line before you check in. If all of this is still worth your while, you will get your forms stamped which approves them for refund.

The stamped forms can then be sent back to the retailer or whatever agency they use to process the refunds. They will issue you a cheque in British Pounds minus a processing fee. Alternatively you can get an instant cash refund at the airport. The official Heathrow page tells you that the refunds are handled through Travelex, who also does foreign exchange.  Handy if you want your refund in your home currency and are willing to pay airport exchange rates. Travelex locations are listed on the Heathrow terminal maps.

At the end of the day, this could be a lot of hassle. If I make any large purchases I will probably try to get a VAT refund form and check to see how long the line is at the customs refund office.
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2 thoughts on “UK Value Added Tax (VAT) Refunds for Visitors

  1. Well, I wish my pockets were full of unmounted gemstones so that I could take advantage of these tips.:) Very helpful information. I love it when someone cuts through the red tape and explains the process so that others can benefit.

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