Retail Export Scheme

Visitors to Europe can save on vacation shopping by taking advantage of the Retail Export Scheme. We'll use the UK and Ireland as examples, two countries highly visited by American travelers, but the scheme is open to all travelers residing outside the European Union.

While you're in the United Kingdom or Ireland, you will pay a sales tax called Value Added Tax (VAT) on most goods that you buy. In the UK, VAT is charged at 17.5 percent on most goods and services (you pay no VAT on some items, such as books and newspapers). In Ireland, in most cases, VAT is 21 percent of the net price of the goods - which works out to 17.36 percent of the selling price (except for books and children's clothing and footwear - there is no VAT on these). The Retail Export Scheme allows you to reclaim a VAT refund on most goods, provided:

• You are an overseas visitor whose habitual residence is not within the European Union.
• You intend to leave the UK or Ireland for a final destination outside the EU, with the goods, by the last day of the third month following that in which the goods were purchased (goods purchased in January must be exported by April 30).
• You produce the goods and VAT refund document to a customs export officer at the last point of departure from the EU.

Not all shops participate in the scheme. Check before you buy. The scheme is voluntary and retailers do not have to participate, but they will usually advertise if they do. Services such as hotel, car rental, taxi fares and meals do not qualify for the scheme - even though you may have been charged VAT on them. Also, remember that qualifying rates vary between countries. This scheme can be a great way to get more bang for your buck while you're abroad, but you need to check out the country's policy carefully before you buy.

Once you find your genuine clan tartan or piece of Galway crystal:

• Tell the retailer that you want to use the scheme and ask him or her to explain how it works.
• Tell the retailer your country of final destination (he or she will need to see your passport).
• The retailer will give you a VAT refund document at the time of the sale and you must complete the customer details and sign the customer's declaration.
• Make sure the retailer completes fully his/her part of the form and signs the retailer's declaration.
• Find out how the refund will be made, for example, check or credit card, how long it will take to receive the refund and any administrative charges they will make.

The goods must be available for inspection and the VAT refund form must be presented to the Customs export officer at the final point of exit from the EU. The form must be certified with a customs stamp.

To make your claim: Retailers will usually make a refund only when they receive the certified VAT refund documents with a customs stamp. Many retailers appoint a VAT refund company to make refunds on their behalf. In these cases, you must send the VAT refund documents certified by customs to the refund company. Some refund companies operate from airport refund booths and make cash repayments if you are leaving directly from the UK with the goods. An additional administrative charge may be made for this service.

Global Refund Tax Free Shopping is a reliable VAT-refund system. There are three easy steps:

Another really useful source is Premier Tax Free. The Web site explains tax-free shopping and VAT rates and, crucially, the minimum amounts of money you have to spend to qualify. There are also guides to shops in Europe that operate the refund scheme.

In addition to the UK and Ireland, other countries within the European Union are Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal, Slovakia, Slovenia, Spain and Sweden.