How To Make The Most Of Tax Free Shopping In London

In London, most goods and services except basic food items, books and children’s clothing, attract Value-added tax (VAT), which is a 20% sales tax. Restaurants are bound by law to include VAT in their menu prices. However, if you are an international visitor to London, you are entitled to get a VAT refund on all purchases made by you in the city and also for business expenses that you might have incurred while visiting the city. The various conditions for eligibility for refund include the following: you will be eligible if you are travelling for leisure purposes or visiting friends and family; you should have spent fewer than 365 days out of the last two years prior to making the purchase living in the UK; and you must be leaving the EU (for at least 12 months) within three months of making the purchase.


Also known as the Retail Export Scheme or Tax-Free Shopping, the VAT refund scheme is not being implemented by all shops as different shops have different minimum purchase conditions which are usually a minimum shopping value of £75 in any one shop. It is advisable for you to request for a special form (VAT 407) from the participating shops where you have done some shopping. You will need to present the filled up form along with the goods and receipts to customs when you are departing from the country. It is important to remember that VAT-free goods can’t be posted or shipped home. After the form has been certified by the customs, you should return it to the shop for a refund (less an administrative or handling fee). The refund usually takes about 8 to 10 weeks to come through.

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For presenting the form at the customs at the airport, you should allow enough time before your flight departs for the formalities to be done. When you reach the airport, you should first go to the Customs desk before you check in for your flight, and present your completed Tax Free Form, passport and purchases to get a stamp on your form. You must make sure that the goods should be unused and they should not be packed in your check-in luggage as they have to be shown to the Customs Officer. You can find customs offices at Heathrow and Gatwick Airports while a Customs box is available at other airports or ports, where the Tax Free Forms can be left for stamping. At the Customs office, there is a telephone that you can use to contact a Customs officer in case you have high value goods like jewellery and electronics so that the goods can be inspected. For business travellers, tax reclaim opportunities are available for overseas companies and individual travellers. It is worth noting that if you submit an incomplete form, no refund will be made. If you were in a rush and could not get the form stamped while leaving the country, you can mail your stamped completed Tax Free Forms to the address of the Processing Centre and receive your refund on your credit card. The Form must be duly stamped by an official UK  or any other EU Country customs within 3 months following the month when the Form was issued.

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Useful Information:

You are eligible for tax free shopping if you have a permanent residence in a non-EU country or if you are a European Community resident intending to leave the United Kingdom for a destination outside the EU by the end of the third month after the month when you bought the goods. You must stay outside the EU for at least 12 months. The standard VAT rate is 20% while for Children’s car seats it is 5%. The minimum purchase amount is 30GBP. Refunds are paid on all goods that are exported in the traveller’s personal luggage. The non-refundable goods are the goods with 0% Vat such as most food items, books, newspapers and magazines, children’s clothes, special exempt items like equipment for the disabled people and car spare parts, new or used cars, a boat that you plan to sail to a destination 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, un-mounted 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, and service charges such as hotel expenses.

Tax Free Shopping in London:

Some of the top places in London where you can do tax free shopping include many famous department stores like the House of Fraser in Oxford Street, where you can shop for luxury brands and a personal shopping service. Regent Street is also home to many international brands such as Tommy Hilfiger, Hugo Boss and Zara, as well as flagship stores for J Crew, Michael Kors and Karl Lagerfeld. Hamleys, the oldest toy store in the world, is also located here offering 50,000 toys spread across seven floors. The largest and finest collection of British & International luxury brands and UK flagship stores of Ralph Lauren, Chanel, Gucci and Alexander McQueen, as well as fine jewellery boutiques from Boodles and Damiani, are located at Old and New Bond Street. At Knightsbridge, you can find Harvey Nichols, the famous department store and fashion powerhouse and ateliers for very British brands like Burberry, Stella McCartney, and Vivienne Westwood. At Sloane Street, you can visit boutiques offering power brands such as Saint Laurent, Christian Dior, and Giorgio Armani – home to Armani Privé.

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