London is a truly amazing place to visit, boasting some of the world’s most exciting shopping opportunities, dining and entertainment experiences and historical landmarks. What’s even better is that if you’re visiting from a country that’s outside the European Union (EU), then you’ll be eligible for tax-free shopping in London. Let’s take a look at how it all works, as well as where to find the best places in the Capital to shop till you drop!
How does tax-free shopping work?
Valued-added tax (VAT) is charged on a number of goods and services in the UK. It is a tax levied at 20 per cent of the purchase price. Tax-free shopping allows travellers leaving the EU to claim a VAT refund on goods purchased in the UK and then taken home. It’s officially known as the Retail Export Scheme.
Anyone who lives outside the EU or who plans to take goods out of the EU by the last day of the third month after the month the item was purchased in, can apply for a VAT refund. So, if you’re staying a while, you can still make use of the scheme as long as you take the goods out of the EU within three months of buying them.
Not all shops in London offer tax-free shopping, and some have a minimum spend value of around £30, so it’s important to check before you make a purchase. There are a few more rules you’ll need to stick to.
You won’t be able to claim the VAT back on:
- Anything you’ve opened and fully or partially used, for example perfume
- Mail order or online purchases
- Goods worth more than £600 that will be exported for business purposes
- Motor vehicles and boats
- Goods that will be exported as freight and that need an export licence
- Unmounted gemstones and bullion over 125 grams
- Services, such as hotel and restaurant bills
How to shop tax-free in London?
First, find yourself a shop that offers tax-free shopping. Let the shop assistant know that you want to use the tax-free scheme and show them your passport or national ID card.
The shop assistant will explain how you’ll get your refund, when you’ll receive it and what the shop will charge you for using the service.
You’ll be given a VAT refund form. Fill it in and sign it in the presence of the shop assistant. They will then complete their parts of the form in front of you. You’ll need to take the form and goods and all the receipts with you to show customs as you leave the EU. They will then check everything and, if all is in order, they’ll stamp the form for you.
Be sure to leave yourself plenty of time for all of this because there are often queues at the VAT refunds desk at the airport or port.
You can also use a commercial refund agent to manage your tax-free shopping in London. There are a number of these agents and many of them promote the fact that they charge less in commission and fees than the stores, plus a lot make the process more streamlined, using a smartphone app that consolidates all your purchases for the whole trip rather than using one form per store, so it may be worth exploring your options.
Popular places to shop in Central London
If you’re coming over to take advantage of the tax-free shopping opportunities in the shopper’s paradise that is London, and to make the most of the currently beneficial exchange rates on various currencies such as the Dollar, then you’ll want to know the best shopping spots in Central London.
Oxford Street is known as the busiest shopping street in Europe. It’s a mile and a half stretch of stores offering a diverse range of retail, from designer labels to reliable high street brands and symbolic department stores. It’s on Oxford Street that you’ll find Selfridges, one of the world’s most well-known retail icons dating back to the early 1900s.
Regent Street is considered by some a touch more elegant than Oxford Street. Art Deco listed buildings surround the likes of the notable mock Tudor Liberty London store, and Hamleys, the iconic multinational toy retailer which has held pride of place on Regent Street since 1881. Here you’ll find the flagship Burberry store; more than just a retail outlet, this fashion store screens catwalk shows and live concerts and boasts its own café. As we’re brand name dropping, there’s also the massive Apple store, Karl Lagerfeld, Michael Kors, Mulberry and Ted Baker, all sitting alongside an array of top-notch eateries such as the Cuckoo Club, The Langham and Roux at the Landau.
Carnaby Street is an iconic, pedestrianised shopping district made up of 14 intertwining streets, once frequented by the likes of the Rolling Stones and the Beatles. It’s where independent boutiques sit shoulder-to-shoulder with beauty and fashion chains, all aimed towards shoppers that err on the more quirky side. The Newburgh Quarter is Carnaby Street’s creative shopping zone; a place with its own unique identity offering one-off concepts and signature styles from independent brands, alongside an array of restaurants, cafés and pubs.
Rathbone Square is the perfect shopping destination for those who want to duck out of the hustle and bustle of the mainstream retail districts of London. Shopping can be tiring, so imagine being able to rest up and take a breather and enjoy some fresh, green space. In London you say? Oh yes! It’s all possible at Rathbone Square.
This is a tranquil public space created around a stunning planted landscape. Trees and shrubs, water features, outdoor seating; it’s all there waiting for you to break from the crowds and regroup. It’s only minutes from Tottenham Court Road and Oxford Circus Tube stations, so right in the centre of the action, but without the hubbub.
There are some fabulous places to eat here too. Warm and friendly restaurants, cafés and coffee shops are set around the Square ready to welcome you for your much-needed respite. Rathbone Square has its own share of top retail outlets as well, so it’s got to be a must-visit destination if you’re planning a tax-free shopping trip to London.
Stop off at Rathbone Square when tax-free shopping in London!
Rathbone Square is the perfect place to visit when you’re tax-free shopping in London. Centrally located and offering a getaway from the hustle and bustle of the main shopping districts, it’s a haven of tranquillity that’s a rare find in London.Back to Blog