How to Claim VAT Refunds
By Rick Steves
Every year, tourists visiting Europe leave behind millions of dollars of refundable sales taxes. For some, the headache of collecting the refund is not worth the few dollars at stake. But if you do any extensive shopping, the refund is fairly easy to claim: Bring your passport along on your shopping trip, get the necessary documents from the retailer, and track down the right folks at the airport, port, or border when you leave.
The standard European Union Value-Added Tax ranges from 8 to 27 percent per country. Exact rates and purchase minimums change (and vary with the type of goods being purchased); you can double-check with merchants when you're there.
Though you aren't entitled to refunds on the tax you spend on hotels and meals, you can get back most of the tax you paid on merchandise such as clothes, cuckoos, and crystal. You're not supposed to use your purchased goods before you leave Europe — if you show up at customs wearing your new Dutch clogs, officials might look the other way, or they might deny you a refund.
To get a refund, your purchase has to be above a certain amount, depending on the country. Typically, you must ring up the minimum at a single retailer — you can't add up your purchases from various shops to reach the required amount — so if you're doing a lot of shopping, you'll benefit from finding one spot where you can buy big. You need to collect your refund within three months of your purchase.
The precise details of getting your money back will depend on how a particular shop organizes its refund process. In most cases, you'll present your refund documents at the airport on the way home. Some stores may offer to handle the process for you (if they provide this service, they likely have some sort of "Tax Free" sticker in the window). Some merchants will reimburse your credit card on the spot, or you may be able to take your paperwork to a nearby third-party agency to get an immediate cash refund (minus a commission for the quick service; these tend to be located at money-exchange counters near touristy shopping areas — think the Champs-Elysées). In either case, you may need to get the documents stamped at the border, then mail them back; if the shop or agency never received the documents, they'll charge the refund amount to your credit card.
At the Shop
The details on how to get a refund vary per country, but generally you'll need to follow these basic steps:
Bring your passport. You'll likely be asked to present your passport when you make the purchase, in order to start the refund process. (A photo of your passport usually works.)
Shop at stores that know the ropes. Retailers choose whether to participate in the VAT-refund scheme. Most tourist-oriented stores do; often you'll see a sign in the window or by the cashier (if not, ask). For any significant purchase, even at a boutique shop, it's always worth asking about a VAT refund. It'd be a shame to spend big bucks at a place and not have a chance of getting a refund.
Get the documents. When you make your purchase, have the merchant fill out the necessary refund document. Check the paperwork to be sure nothing important is missing, then attach your receipt to the form and stash it in a safe place.
Weigh the cost of shipping versus VAT refund. If the store ships your purchase to your home, you won't be charged the value-added tax. But shipping fees and US duty can be pricey enough to wipe out most of what you'd save. Compare shipping costs to your potential VAT refund — it may be cheaper to carry the items home with you.
At the Airport or Departure Point
Bring your paperwork and purchases, and arrive early. Assuming you left the store with your purchase, receipt, and VAT paperwork (but no refund), you'll need to get the refund processed before going home. If you've bought merchandise in a European Union country, process your documents at your last stop in the EU, regardless of where you made your purchases. So if you buy sweaters in Denmark, pants in France, and shoes in Italy, and you're flying home from Greece, get your documents stamped at the airport in Athens. (If the currencies are different in the country where you made your purchase and where you process your refund — say, euros and Czech koruna — you may have to pay an extra conversion fee.) And don't forget: Switzerland, Norway, and Turkey are not in the EU, so if you buy in one of those countries, get your documents stamped before you cross the border.
Be careful if you leave the EU by train. Bigger train stations handling international routes will have a customs office that can stamp your documents. But depending on your route, you may have to get off the train at the last station within the EU to get your stamp; in some cases, a customs agent might board the train. Ask train-station staff about the customs arrangement for your particular route.
Get your documents stamped at customs. At your point of departure, find the local customs office, and be prepared to stand in line. Some customs offices are positioned before airport security; confirm the customs location before going through the security check. In smaller airports, train stations, ports, and less-trafficked border crossings, finding the right customs agent can be tough — give yourself plenty of time.
At customs, an export officer will stamp your documents and may ask you to present your unused goods to verify that you are, indeed, exporting your purchase — if your purchases are inside your checked luggage, stop by customs before you check it. (Some retailers, particularly those in Scandinavia, will staple and seal the shopping bag to keep you from cheating.)
Collect the cash — sooner or later. Once you get your form stamped by customs, you have to turn it in. If your purchases were bought from a merchant who works with a refund service such as Global Blue or Planet, find their offices inside the airport. These services take a cut of your refund (about 4 percent), but save you further fuss and delay. Present your stamped document, and they'll likely give you your refund in cash, right then and there. The refund will be in the currency of the country from which you depart; if you want to be reimbursed in a different currency, such as US dollars, you'll be subjected to their (unfavorable) exchange rates. Otherwise, they'll credit the refund to your credit card.
Other refund services may require you to mail the documents — either from home, or more quickly, just before leaving the country (using a postage-free, preaddressed envelope — just drop it in a mailbox after getting your customs stamp). Then you wait. It could take months. Look for a refund on your credit-card statement or for a check in the mail. If the refund check comes in a foreign currency, you may have to pay a fee ($40 or so) to get your bank to cash it.
Don't count on it. My readers have reported that, even when following all of the instructions carefully, sometimes the VAT refund just doesn't pan out. (For example, they have all the paperwork ready when they get to the airport but can't find the customs official to process it, or they turn in their forms but never get paid.)
Only you can decide whether VAT refunds are worth the trouble. As for me, my favorite trip souvenirs are my photos, journal, and memories. These are priceless — and exempt from taxes and red tape.