International trade, international visits and VAT

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Overseas traders visiting the UK - getting a VAT refund

Overseas traders visiting the UK - getting a VAT refund

If you're registered as a business in a country that's not in the European Union (EU) you may be able to use the Refund Scheme to reclaim VAT on purchases of goods and services you use in the UK and on imports into the UK.

This guide will tell you who can use the Refund Scheme, when you can and can't claim under the scheme, how to make a claim and how you'll be paid.

On this page:

Who can use the Refund Scheme?
What you can and can't claim under the Refund Scheme
How to claim
How much you can claim
Evidence needed for claims
Making your claim
If your claim is sent back or refused
Incorrect claims
More useful links

Who can use the Refund Scheme?

If you're registered as a business in a non-EU country, you can use the Refund Scheme to reclaim VAT you pay in the UK as long as all of the following apply:

you're not registered for VAT in the UK and don't have to, or can't be, registered here
you don't have a place of business or a residence in the EU
you don't make any supplies in the UK

But if you do make supplies in the UK, you can still use the scheme if the only supplies you make here are either:

transport services related to international carriage of goods
goods and services you provide where the person in the UK you supply the services to has to pay VAT

You can only use the Refund Scheme if your own country operates a similar scheme and makes it available to UK businesses. If your country has its own Refund Scheme but doesn't let UK businesses use it, you can't claim under the UK Refund Scheme.

VAT Retail Export Scheme

Temporary visitors - usually tourists - to the UK from outside the EU can sometimes get the VAT refunded on goods they buy in shops. This only happens if the shop you're buying from takes part in this voluntary scheme. Businesses from outside the EU who visit the UK don't usually buy goods for their business from shops and can't use the VAT Retail Export Scheme, but they can use the Refund Scheme to claim back VAT they pay on goods and services - providing they are for use in their business.

Read about the VAT Retail Export Scheme

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What you can and can’t claim under the Refund Scheme

You can't use the Refund Scheme to reclaim VAT on all the goods and services you buy.

What you can reclaim VAT on

You can use the scheme to reclaim VAT on certain goods and services you buy in the UK, including:

accommodation and meals
trade fairs
travel costs
car rental
other goods and services you buy and use in the UK

What you can't reclaim VAT on

You can’t use the scheme to reclaim VAT on:

goods and services that are not for business use - but if you buy something to use in your business and privately, you can reclaim VAT on the business part
anything you've used - or will use - to make a supply in the UK
the supply or importation of most ordinary business cars - and you can only reclaim 50 per cent of the VAT on hiring or leasing a car for mixed business and private use
some second hand goods - like cars and antiques - that a VAT invoice isn't issued for
all business entertainment and hospitality expenses
goods that are exported - but these are zero-rated so long as the supplier has the necessary evidence
goods and services for travellers' direct benefit - for example hotel accommodation - you buy to resell

Imports

If you import goods into the UK you can reclaim any VAT that's due as long as you don’t get any other VAT relief when you import them. But remember, you won't be able to reclaim VAT under the Refund Scheme if importing the goods means you have to register for VAT in the UK.

Find out about importing goods into the UK

Find out when you must register for VAT and when you can choose to register

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How to claim

From 1 January 2010, you will claim refunds of VAT incurred in the UK electronically, through the UK Government Gateway, rather than on paper.

Find out more about the forthcoming changes to the cross-border VAT rules

You can make a refund claim yourself or you can use an agent, it's up to you. To be able to act for you and receive money on your behalf, your agent will need either:

a power of attorney
a letter of authority

Example of a letter of authority HM Revenue & Customs (HMRC) will accept

‘I [name and address of claimant] hereby appoint [name and address of agent] to act on my behalf in connection with any claim I make to HM Revenue & Customs under the Value Added Tax Regulations 1995 as from time to time amended or replaced. Any repayment of VAT to which I am entitled pursuant to any such claim made on my behalf by my above named agent shall be paid to [name and address of payee].

Date……………..Signed………………………… [by the claimant]'

Time limits for making a claim

You must make a claim no later than six months after the end of the 'prescribed year' that you paid the VAT in. The prescribed year is the 12 months from 1 July to 30 June, so you must make a claim by 31 December. The time limit is strictly applied.

HMRC deals with all claims in the order they are received - there is no priority system - and you will get your refund within six months of sending your claim.

Claim forms

You need to complete a VAT 65A form to make your claim and send to the address on the form.

Go to form VAT 65A - Application for refund of VAT

You must:

fill in the form in English using block capitals
send the form with proof of the VAT you've paid

For help completing the form you can contact the Overseas Repayment Unit on Tel 028 7130 5100 if you're phoning from in the UK, or on Tel +44 28 7130 5100 if you're calling from outside the UK.

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How much you can claim

There isn't a maximum amount of VAT you can claim. But the UK has set minimum amounts that you can claim to have refunded.

Your claim can’t be for a period of:

more the full prescribed year
less than three months - unless that’s all that’s left of the prescribed year

Your claim should include all the VAT you paid in that period.

Period of time you're reclaiming VAT for	Minimum amount of VAT you can claim
Less than 12 months	£130
Full 12 months of the prescribed year	£16
Less than three months (if that's all that remains of the prescribed year)	£16

You can also include items missed on earlier claims so long as they related to VAT charged in the year of the claim.

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Evidence needed for claims

You must have the originals of all invoices, vouchers or receipts from your suppliers and any import documents.

If the value of a supply is more than £100 including VAT

In this case the invoice needs to show:

your supplier’s name, address and VAT registration number
the supplier's invoice or reference number
your name and address
details of goods or services supplied
the date of supply
the cost of the goods or services, excluding VAT
the rate of VAT
the amount of VAT charged

If the value of a supply is £100 or less including VAT

In this case the invoice only needs to show:

your supplier’s name, address and VAT registration number
the supplier's invoice number
the date of supply
details of goods or services supplied
the cost of the goods or services, including VAT
the rate of VAT

All amounts must be in sterling.

If you've imported goods

In this case you must have the original VAT copy of the import entry or another original Customs document showing the VAT you've paid.

Certificate of proof of business activity

When you make a claim for the first time - and every 12 months thereafter - you must also send HMRC an official certificate that shows you're registered as a business in your country.

When you apply to your official authority for the certificate, make sure you ask them to include on the certificate all the information that HMRC needs to process your claim. For example, if the invoices are made out in your company’s trading name, the certificate must show this as well as the name of the person registered.

The certificate must include:

the authorising body's name, address and official stamp
your own name and address
the nature of your business
your business registration number

It must be an original certificate, not a photocopy.

Each certificate is valid for 12 months from the date it's issued. It covers all the claims you make during that year. Once the certificate runs out you'll need to send a new one with your next claim.

American businesses can get Form 6166 from the IRS Certificate Unit in Philadelphia.

United States Internal Revenue Service foreign certificate requests

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Making your claim

You need to show that you've taken reasonable care over your claim, and that you've made every effort to get it right. Some of the ways you can show you've taken reasonable care over your claim include:

keeping correctly completed invoices, vouchers and receipts to support your claim and sending these to HMRC with your claim
making sure that you have, and provide, an up-to-date certificate of status
checking what goods and services you can claim VAT on from the UK and, when you don't understand something, getting advice from HMRC or an agent who is familiar with the UK rules and procedures

If HMRC accepts your claim they will:

refund you the VAT you've paid within six months of receiving your claim
cancel the invoices showing you've paid the VAT and return them to you

Method of payment

You can choose to have your refund paid:

directly to your own bank through SWIFT (Society for Worldwide Interbank Financial Telecommunication)
to a UK bank
by payable order in sterling directly to you or to your agent

Payment by SWIFT is the fastest and safest way for you to get your VAT refund. If you choose to be paid by SWIFT you must provide a copy of a bank credit slip and the following information:

bank account number, including SWIFT or IBAN information
currency of account
bank identification code
bank account name
bank name
bank address

Payments to your bank account are made in your own currency, unless you choose otherwise.

If you choose to be paid by payable order you cash it at your own bank. Payable orders are computer generated and - unlike cheques - they're not signed. You shouldn't return a payable order to HMRC to be cashed.

If you have a query about a claim you've made you can contact the VAT Overseas Repayments Unit on:

Tel 0208 7130 5100 if you're calling from within the UK
Tel +44 287 137 5100 if you're calling from overseas

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If your claim is sent back or refused

If you send in a claim that you haven't completed properly, HMRC won't accept it and they'll send it back to you to fill in correctly. They'll tell you what's wrong with it and what you need to do to correct it. For example, you might not have sent all of the evidence required. You must send the corrected claim back by the due date or it will be refused because it will be outside of the time limits.

If your claim is refused HMRC will always tell you why, and when they tell you they will offer you an opportunity to have this decision reviewed by an officer who wasn't previously involved with the original HMRC decision.

You will need to reply to this offer in writing - and send it to the address given in the decision letter - within 30 days of HMRC's decision. Even if HMRC doesn’t offer you a review you can write to officer who made the original decision and ask for a review.

If at any time, you have further information that you think might affect HMRC's decision, you should send it to the officer who sent you the decision letter.

Find out about appeals against VAT decisions

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Incorrect claims

If HMRC finds your claim isn't correct after the refund has been paid, they’ll normally deduct any overpayment from your next refund.

If you've claimed too much, HMRC will get back the amount you've been overpaid by deducting it from the next refund, and you may incur a penalty for sending in an incorrect claim, so you do need to make sure your claim is right. They can also charge you a penalty if you regularly send in incorrect claims.

The UK authorities take a very serious view of false claims. They can recover any refunds obtained by a false claim and can charge you a penalty.

Read about new penalties for errors in claims for VAT refunds (PDF 53K)

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