VAT Refunds

If you plan to visit Europe in the next few months, make sure you take advantage of the VAT refunds. VAT stands for value-added taxes, which means you can shop tax-free in Europe. Keep in mind that it’s not a 100% guarantee that you’ll get your tax refund back, but it’s worth a shot. I was able to receive mine back from the United Kingdom within a week after my trip, while it took almost 2 months to receive my VAT back from Iceland. I almost figured it would be a lost cause, but two months later I saw the credit back on my statement.

Here are some tips on how to make it easier to claim your VAT:

  • Bring Your Passport: In order to receive VAT paperwork, stores require that you show them a copy of your passport.
  • Shop at Department Stores instead of Individual Boutiques: It makes it easier, paperwork-wise, to shop at department stores instead of individual boutiques. If you shop at individual boutiques, you’ll have a new tax claim form for each store and not all of them use the same refund service which can make it more complicated to receive your refund. When I was in London, I went to Harrods and did most of my shopping there. In Harrods, they even have a department for you to turn in all of your receipts from their different areas, and they’ll combine it into one easy tax form for you.
  • Arrive to the Airport Early: In order to claim your VAT, you’ll need a stamp by customs in order for it to be approved. Arrive early to the airport, as sometimes the customs line can get very long. Without the stamp, it makes it very hard to receive your refund back.
  • Pack Your Items in an Easy To Reach Area: When you get to customs, the customs officers may ask to see what items you purchased. Make sure you stop by customs first, if your items are in your checked baggage.
  • Collect Your Refund: Once custom approves your VAT refund, you’re free to turn in your documents to a refund service like Global Blue. There are two ways to receive your refund either via cash or credit card refund. In London, we were able to go to the Global Blue desk and swipe our credit card back. We received a receipt that showed what we would receive back in the form of  the refund. In Iceland, you turn in a form with your credit card number, and hope for the best. Depending on the situation, you can also ask for an instant cash refund, but keep in mind that there might be a fee for taking cash.  In the future, I plan to do a cash refund unless the refund service swipes my card instantly like in London for the refund. I was worried I wouldn’t receive my refund from Iceland as I hand-wrote the credit card numbers and my handwriting is messy.

If you plan to purchase anything expensive in Europe, it might be worth looking at a VAT refund. Even though you’ll save due to the current exchange rates, you can save an additional 15% – 25%. As I said earlier, it’s not a 100% guarantee, so don’t let the VAT refund put a damper on your trip if it doesn’t pan out. Just think of it as an added little bonus if it does.

As always, Happy Shopping!





Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s