Basic Information
Save More with Tax-Free Shopping
Traveling abroad? As a non-resident, you could reclaim VAT on purchases, saving up to 25% in Europe and beyond. It’s simple: shop, get your refund, and bring home more of what you love.
Understanding Tax-Free Shopping (VAT Refunds)
What Is Tax-Free Shopping?
Tax-free shopping, or VAT refunds, is a system that enables tourists to reclaim the Value Added Tax (VAT) on eligible purchases made while traveling abroad, provided the purchased goods are taken out of the country and brought back to the visitor's home country. This incentive allows non-residents to save on purchases, encouraging tourism and spending in countries offering VAT refunds.
Who Qualifies for Tax-Free Shopping?
To qualify, a visitor must:
Reside permanently outside the European Union (EU) or in another applicable non-resident area, as indicated by the address in their passport or national identity document.
Be leaving the EU or applicable country directly after their purchase, with goods intended for export out of the region.
Examples:
1.Eduardo lives in Brazil but spends his summers in Portugal. Although he visits Portugal frequently, his permanent address in Brazil qualifies him as a ‘visitor’ for VAT refund purposes.
2.Paul, a Belgian citizen living in Canada, returns to Belgium annually. As a permanent resident of Canada, he is eligible for VAT refunds on goods bought during his visits to Belgium, using his Canadian residence card as proof of residency.
How Much Can Be Saved?
VAT rates vary by country, affecting the amount eligible for refund:
VAT can reach up to 25%, allowing significant savings.
What Is VAT?
Value Added Tax (VAT) is a consumption tax levied at various stages of production and distribution, ultimately paid by the end consumer. Non-residents can recover this tax on eligible purchases made in the EU and other participating countries, thus enjoying reduced costs while abroad.
Why Do Countries Offer VAT Refunds?
More than 50 countries currently support VAT refunds as a means to attract international tourists and encourage spending. This system not only benefits visitors by offering savings but also boosts the local economy by promoting retail activity.