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Guide to shopping tax-free in Northern Ireland

01/13/2021

Typically almost half a million of non-EU travellers come to Northern Ireland each year to enjoy the incredible countryside, historic towns, and possibly play a round of golf. Despite Brexit, visitors to Northern Ireland will still be able to take advantage of tax-free shopping during their trip.

Who is eligible for a VAT refund in Northern Ireland (NI)?

On the surface, getting your VAT back on goods brought in NI can seem complicated. Once you get the hang of things, however, it is a relatively simple process. The first thing is to decide is whether you are eligible to claim the refund:

  • If you come from outside the EU for a visit to NI and then return home, you can claim;
  • If you live in the EU or NI, whether you are studying or working, but are planning on leaving the EU or NI for the next 12 months, you can also claim.

Note that, even though England, Scotland, and Wales (i.e. Great Britain) are not part of the EU any longer, permanent GB residents are not entitled to a VAT refund in NI  (unless the same VAT is accounted for in GB, making the exercise pointless).

You will need to provide proof of your eligibility to both retailers and customs officers. Usually your non-EU passport should be sufficient. Although in cases where you hold an EU/GB passport but live permanently outside the EU/NI, you will need to provide additional proof that would usually be stated on your non-EU visa/work permit, or  formal employment/university letters. It is up to you to demonstrate to a Border Force officer that you are a non-EU resident so make sure to bring along enough evidence in cases where your personal circumstances are not straight forward.

What is covered by the tax-free shopping

While most goods and services include 20% VAT in the price, the scheme only works for items that you bought for personal use and plan to take back home in your luggage at the end of your visit. This typically includes goods such as jewellery, cosmetics, watches, clothes, portable electronics, and souvenirs.

Services like restaurant meals, tickets, hotel accommodation, on the other hand, can’t be consumed in your home country so are not eligible for a VAT refund.

You can only claim VAT refunds for merchandise in your baggage that you carry in person so you won’t be able to buy heavy or bulky items in NI and have them shipped to your home as freight.  

A simple rule to remember is that if you cannot put something in your personal luggage to be carried to your home country, it is not eligible for tax-free shopping.

Note that from 1 January 2021, both in-store and online purchases are accepted but make sure to use a refund operator that can digitally verify your identity and eligibility to use the scheme for internet shopping.

How tax-free shopping scheme works

The process is managed by tax refund operators who work with retailers and customs to process VAT claims. You will get charged an admin fee for their services and this commission will always be stated on your tax form, known formally as a VAT407 form, (read more here to understand how your VAT refund is calculated).

Once a retailer or their agent issues a tax form to you for a particular purchase, you cannot use another refund company to process your claim for this specific purchase. Although you can return the original tax form to the retailer and request them to void the claim if you wish to use another company.

It is possible to end up with multiple VAT407 forms from different retailers and agents by the end of your trip. Because each operator company has slightly different procedures, it can get confusing to follow all the instructions correctly. Be sure to read the small print for each one or try to stick to one refund agent to keep things simpler.

How to have your VAT refund form authorised

When you finished shopping and ready to go home, you will need to have your goods inspected and the tax refund form stamped by customs at the departure airport. This has to be your final departure point from the EU, in case your trip continues on to another EU country after visiting NI.

Each tax-free form needs to be authorised by the last day of the 3rd month following the month in which you made the corresponding purchase.

Your goods must be presented unused and in their original packaging (half empty perfume bottles or eaten chocolates will not pass the inspection!). Ensure that all your original receipts are also available for inspection and match up to the items listed across all your VAT407 forms. Customs officers will check your flight ticket, passport, and stamp your documents.

Remember “No stamp, no refund!” and you will not be able to get your form stamped retrospectively or when you arrive home.

A final word of warning is that you should not attempt to mislead customs as it may result in your goods being taken away or you being held up at the border causing you to miss the flight. Border Force officers are also excellent psychologists so usually can instantly see through any attempts to blame rule ignorance or carelessness!

Getting your VAT paid back

Depending on the airport and your refund operator, the procedure of getting the payment varies and can usually take a few weeks.

After getting your tax-free form stamped, generally there are two options. You can either get the payment immediately in cash at the airport, or send the tax form back to the company that issued the form and wait for the refund to be transferred to your account.

While tempting, getting the refund immediately in cash comes with higher charges compared to waiting a few weeks to get an electronic transfer. Typically there will be a £1-3 charge per each tax form and then additional cost of 10-20% in a form of exchange rate mark-up or other charges.