The Retail Export Scheme

The UK is a popular destination for tourists, students and business people from all over the world. From the excitement of London to the windswept hills of Edinburgh, foreign tourists alone ploughed over £21billion into the UK economy in 2013.

Any business that makes money from overseas visitors will want to ensure the process is as simple as possible for everyone involved, especially with regards to tax.

This is where the VAT Retail Export Scheme comes in.

What is the VAT Retail Export Scheme?

Also known as Tax Free Shopping, this scheme aims to make sure that visitors aren’t double taxed when they buy goods (not services) in the UK and then import them into their home country.

When the transaction is made, the UK retailer charges VAT as they usually would and then gives the visitor a document detailing this transaction. This document is in turn presented with the goods to a customs official on departure from the EU.

The form is then passed back to the retailer who refunds the visitor the VAT they paid and zero-rates the sale in their own business accounts.

Who is eligible?

The VAT Retail Export Scheme applies to those coming to the UK from outside the European Community (EC).

For an individual to take advantage of it they must be either:

  • someone who is resident or domiciled in a non-EC country, who intends to return there after their time in the UK
  • coming to work or study
  • an entitled EC resident such as those planning to leave the EC for at least 12 months.

What goods are eligible?

Similarly, the scheme is only open to some goods:

  • motor vehicles and boats
  • goods over £600 to be exported for business purposes
  • exported as freight
  • those requiring an export license
  • bullion and unmounted gemstones
  • mail order or internet purchases.

A few more technical details

There is no set minimum sales value, although individual retailers can set a minimum value under which the scheme will not apply as well as choose the items to include.

Zero-rated goods like certain kinds of children’s clothing, food and books cannot be included in the scheme.

Students and migrant workers will only be refunded for purchases made in the last 4 months of their stay.

Call us on 01375 383 888 if you need more information or advice on the VAT Retail Export Scheme and its technicalities.

You can also fill in our contact form or email

21 Lodge Lane
RM17 5RY

Tel: 01375 383888
Fax: 01375 391672