How to Claim a VAT Refund in the UK

How to Claim a VAT Refund in the UK

A Complete Guide for Businesses & Tourists of How to Claim a VAT Refund in the UK

Did you know that businesses and tourists can reclaim VAT (Value Added Tax) paid in the UK? Whether you're a registered UK company, an overseas business, or a visitor, understanding the VAT refund process can save you significant money. This guide covers who qualifies for a VAT refund, step-by-step claiming procedures, and key deadlines to ensure you get your money back efficiently.

Who Can Claim a VAT Refund in the UK?

VAT refunds apply to different groups under specific conditions:

1. VAT-Registered UK Businesses

  • Can reclaim VAT on business-related expenses (goods/services).
  • Must file regular VAT returns with HMRC.

2. Overseas Businesses (Outside the UK)

  • Eligible if not VAT-registered in the UK but incurred VAT on business costs.
  • Must apply via the VAT65A form or electronic portal.

3. Tourists & Visitors

  • Can reclaim VAT on purchases over £100 via the Retail Export Scheme.
  • Requires a stamped VAT 407 form upon leaving the UK.

How to Claim a VAT Refund: Step-by-Step

For UK Businesses

  1. Keep detailed records of all VAT-paid invoices.
  2. Submit a VAT Return (Form VAT100) quarterly to HMRC.
  3. Offset refunds against future VAT liabilities or request a cash repayment.

For Overseas Businesses

  1. Complete Form VAT65A (for non-EU businesses) or use the EU refund system.
  2. Submit invoices and proof of business activity.
  3. Await processing (typically 4–6 months).

For Tourists (Tax-Free Shopping)

  1. Shop at stores displaying "Tax-Free Shopping" signs.
  2. Request a VAT 407 form at checkout.
  3. Get the form stamped by UK customs before departure.
  4. Mail it back or submit via a refund agency (e.g., Global Blue).

Key Deadlines & Rules

  • UK businesses: Claims must be filed within 4 years of the VAT period.
  • Overseas businesses: Submit within 6 months of the calendar year’s end.
  • Tourists: VAT 407 forms must be stamped within 3 months of purchase.

Common VAT Refund Mistakes to Avoid

  • Missing invoices or incomplete forms.
  • Failing to get customs stamps for tourist refunds.
  • Claiming non-eligible expenses (e.g., entertainment).

Conclusion

Claiming a VAT refund in the UK can be straightforward if you follow the correct process. Businesses should maintain accurate records and file returns on time, while tourists must ensure their paperwork is stamped before leaving the UK. Need help? Consult a UK VAT specialist or HMRC’s official guidelines for tailored advice.