Retail export scheme

How do retailers operate the scheme?

As a retailer, you can operate the scheme in two ways. You can:

  • operate the scheme yourself
  • or
  • use a refund agent.

If you operate the scheme yourself, you will charge Value-Added Tax (VAT) on the sale to the tourist or traveller, issue an export voucher showing details of that sale and return VAT as normal in your VAT return.

When you receive evidence that the goods have been exported and all other conditions of the scheme have been met, you will:

  • refund the VAT to the tourist or traveller
  • and
  • take a credit in your VAT return for the VAT previously returned.

What evidence do you require that a person is a tourist or traveller?

You must record and retain the following records as proof that the purchaser is a tourist or traveller:

  • the date of arrival of the tourist or traveller in the European Union (EU)
  • the intended date of departure of the tourist or traveller from the EU
  • the number of the tourist's or traveller's passport
  • the permanent address of the tourist or traveller outside the EU
  • a signed declaration that the tourist or traveller is not resident within the EU or Northern Ireland at the time of the purchase. 

What records do you need to retain in relation to each sale?

You must retain the following information in relation to each sale as part of your records:

  • a copy of the export voucher issued to the tourist or traveller
  • the name and permanent address of the tourist or traveller
  • the date of the transaction
  • a description of the goods supplied
  • the amount of the purchase and the amount of the VAT charged (or "VAT off" if this applies)
  • the signature of the tourist or traveller
  • the rate of exchange or the method to be used to determine the rate, if the refund is to be made in a currency other than Euro.

In no circumstances, should blank retail export scheme documentation be given to a tourist or traveller for subsequent completion.

When you make a refund to the tourist or traveller, you must retain the following as part of your records:

  • the net amount actually refunded to the tourist or traveller
  • the date and method of the repayment.

What evidence do you require that the goods have been exported?

In all cases you are required to retain the export voucher certified by a Customs Officer. In addition, where the goods are exported by a tourist or traveller who is a resident of Great Britain and the total value of your sales to that person exceeds the personal allowance for payment of import taxes in Great Britain, you will also need evidence that the import VAT and duties payable under UK law have been paid on the importation of the goods into Great Britain, where appropriate. 

What happens if the sale is voided or reversed?

Where a sale is voided, you must obtain original copies of all documentation relating to that sale and retain those documents as part of your records. This includes original receipts that you issued to the tourist or traveller. An example of a voided sale is where goods sold are returned.

What happens if I use a refund agent?

If you use a refund agent, you will enter into an agreement with that agent. This involves you making a sale of the goods to the refund agent who simultaneously makes a sale of those goods to the tourist or traveller. You complete an invoice in respect of the sale to the agent and you return the VAT, as normal, in your VAT return.

Next: How do refund agents operate the scheme?