What is Tax Free Shopping? How do I get reimbursed? What is VAT? Who is eligible ? Below are the answers to all of your questions! 

Anyone who has their primary residence outside of the European Union (EU) has the right to claim VAT refunds. Shoppers can request a refund on any purchase made in the EU that will be taken home in their luggage.

Surprisingly, few people take advantage of this great opportunity, even fewer even know about this possibility! Woonivers is here to help you understand all aspects of VAT refund process and help you to be a smarter shopper.

What are VAT refunds?

First we must understand what Value-Added-Tax (VAT) is. The European Commission provides us with a perfect description; “VAT applies to all goods and services bought and sold within the European Union for the purpose of being consumed.” Therefore, goods that are sold to foreigners can be classified as exports and as such, are not subject to VAT taxation.

What does this mean? A traveller coming to visit any country within the EU has the right to be refunded the VAT paid on any goods they intend to return home with. To prove that goods are being exported, they must be carried in your luggage and presented to customs agents at the airport who will verify their status. 

Who is qualified for VAT refunds?

1. You must have residence outside of the European Union.
   • Only people who do not live in the EU have this right, and your residence is considered independent of your nationality! A Spaniard living in the USA can claim these rights, whereas an American living in Spain cannot.
2. You must reach the minimum purchase threshold set by each country in order to claim VAT refunds.
   • VAT refunds are allowed in all EU member states. However, each country can set the minimum purchase amount in order to be eligible to claim a refund. This information will be made available at any store or merchant you shop with! Spain for example, recently got rid of the minimum purchase limit, read more about it here.
3. Goods must leave the EU before three months have passed from the purchase date.
   • If your purchased goods stay for longer than three months in the EU they will no longer be considered as exports. If they remain in the EU, you will not be able to claim a VAT refund. Again, some countries have variations of this rule, for example, France has the time frame set at six months.
4. For you goods you want the VAT refunded, you must leave with them.
   • Only items that leave the EU with you in your luggage will be eligible for refunds, you cannot for example be refunded on a half-used bottle of cologne. NOTE: goods must remain unused and in their original packaging when you take them from the EU.

How can I shop Tax-Free in the European Union?

There are two ways you can take advantage of Tax-Free Shopping:

• The traditional method: This involves first requesting a Tax-Free form from the vendor you are shopping with which must be filled out with all of your information and travel details as well as the invoices of your purchase(s). You must hold onto these forms and have them approved upon your departure. When at the airport, you must first work with a tax operator who will process your refunds before having your items approved by customs (pray there is no queue). Then wait up to three months to get refunded.
• The easy method, with Woonivers: Woonivers is the first 100% digital operator for Tax-Free transactions. All you have to do is upload a photo of your invoices along with your personal information such as departure details, proof of residence, and passport. After this, Woonivers will send you a QR code that you have to scan at the customs machines in the airport. Your refunds will be sent directly to your wallet within the Woonivers application, it’s that easy! 

That is the basics of Tax-Free shopping in the European Union! 

If you want more information on the specifics of these two methods, click here.