Could you explain VAT refunds on purchased items for tourists in Ireland?
– Angela via email
One of the advantages of shopping in the Republic of Ireland and Northern Ireland for Americans and other non-European Union residents is that certain purchases can be bought tax-free. It’s a great opportunity to save on your purchases. However, it’s not available for every item or at every location, and it requires a bit of legwork on your part.
Here’s a bit on the taxes…
In Ireland, most goods are subject to VAT which stands for Value-Added Tax. Think of it as a sales tax that has already been added to the posted price (unlike in the US where taxes are added at checkout). VAT usually runs close to 20%.
Tourists from outside the European Union are not required to pay VAT on certain items they take out of the European Union. Because tax-free shopping is only available on items that leave the country, things like accommodation, meals, car rental/car hire, gas/petrol/diesel, and admission to sites/events do not qualify for a refund.
How do you shop tax-free in Ireland?
First, you must shop with merchants who participate in the tax-free shopping system. Most participating businesses will feature some form of “tax back” or “tax free” sign at their entrance; and if you don’t see a sign, you should ask the clerk if they participate (sometimes they pull the dusty forms from behind the counter to accommodate your request).
There are several companies that handle the tax-free services for merchants, so the steps you take will vary. These companies include www.shoptaxfree.com, www.globalblue.com, www.taxfreeworldwide.com.
Here are a few scenarios:
- Old School: the merchant will ring up your sale with the tax included. They will fill out the merchant section of the tax-back forms and hand them to you. You are then required to fill out the customer section of the forms and submit them to a desk/cashier in the Departures Hall at the airport (each tax-back company has its own desk, so make sure you go to the right one). They will then either give you cash in euros, dollars, add a credit to your credit card, or send a check to your home address (I haven’t seen the check method in a while).
- Credit Card: the merchant will NOT charge you VAT. You will pay with your credit card, and the merchant will hand you tax-back forms or a card that looks like a credit card. If you get the card, you can use it at any participating merchants. You must register your card online while you’re traveling in Ireland or at the kiosk in the Departures Hall at the airport (I suggest doing it before as sometimes the registration website is “down” and may take more than one try). If you get forms, you will submit them for refund at the appropriate desk in the Departure Hall at the airport or via the postal service before you leave Ireland. If you get a card, you will swipe it at the kiosk in the airport Departures Hall (you will also need the credit card you used for purchases). If you don’t swipe your card or turn in your forms, the tax will be automatically charged to your credit card at a later date.
- Mail it Home: merchants in many popular tourist areas will offer to ship your purchases home. If you choose this option, many merchants can automatically save you from being charged VAT (you just have to pay for shipping).
- The Drop Box: some tax-back systems have drop boxes in the Departures Hall at the airport. You simply drop your form into the box before you leave and the tax-back will be given to you via check or credit card refund (or by not charging your credit card the tax).
These systems may appear a bit confusing at first, but both paperwork and refund cards come with a packet of instructions and information that will likely answer your questions.
What if I forget to turn in my forms or swipe my card?
Although the system is built around you taking care of things before you leave Ireland, there are still options once you get home. Review the paperwork provided to find out how to get your refund or who to contact. I should note, this is not an easy alternative that generally requires having your documents stamped by a notary or customs officer.
Are there limits?
Ireland has no minimum limit (other European countries do), so even small purchases qualify. If you’re purchasing an item over €2,000, you’ll need to get a special stamp from customs at the airport (and likely pay duty when you get home).
What if I don’t get my refund or my credit card gets charged?
The system usually works smoothly, but from time to time there are problems… and they can be difficult to remedy. That’s because these programs are not being run by the merchants or a government agency; each tax-back company operates their program independently.
If you don’t get your refund or your credit card gets a charge for “unreturned tax form,” you must go through the tax-back company that processed your request. Many shoppers also dispute these charges through their credit card.
- Keep all your forms and receipts to assure your refund processes efficiently.
- Fill out your forms BEFORE you get to the airport… it’ll save you a bit of stress.
- If you’re leaving Ireland via ferry or minor airport or staying in Ireland for an extended period of time, you’ll want to review your tax-back paperwork to determine the best way to recover your tax-back.
- Only the person on the paperwork can process a refund, so consider consolidating your efforts by putting all your purchases in the same name when you shop.
- You won’t get 100% of your VAT back. About 2% of your purchase price goes to the company processing your refund.
- Refunds are time sensitive; so if you don’t collect your refund at the airport, you might risk losing it if you wait until you get home or if there are any problems processing your refund.
- Although store clerks may have some knowledge about the tax-back system, they don’t always get the details right (especially when talking about how to claim your refund). It’s best to consult your paperwork.
- If you purchase at the airport Duty Free shop, your purchases are already tax-free, so they are not eligible for tax-back.
Feel free to leave any additional tips you might have about tax-free shopping in the comments below…