With the world opening up after a 2-year hiatus and costs becoming more and more challenging, a holiday away is probably at the forefront of most people’s minds, but how can you juggle bills and the need to take a break?
It’s a tough one, but smart planning and being aware of what you can do to cut or redeem some of your costs is going to help.
We all know that watching holiday prices and exchange rates is a smart move, and making sure you have a healthy mix of cash and card for buying necessities (and some not so necessary items) is a key fundamental when it comes to purchasing abroad, but how many of you have looked at the option of claiming the tax back on your purchases or in fact even heard of it? Millions of dollars and Euros remain unclaimed every year mainly because people are either unaware of the Tax-Free claim back process or because it can be seen as complicated.
What is Tax-Free claim back?
Essentially it is the recouping of the tax levied on an item. If you are buying in a foreign country and are not a resident, the purchase is considered an export. The redeemable tax percentages will change depending on the country, but it’s worth considering especially if you’ve treated yourself to something special.
Also – become brand aware as there are several companies that offer this service. In most cases stores offering this Tax-Free solution will display the service, normally on windows/doors and at the till. If you’re in any doubt… ask!
Innova Tax Free
Euronet Worldwide offers this solution via Innova Tax Free. Their service is available in most European countries, and they have partner affiliations with major hospitality and retail brands including Carolina Herrera, Louis Vuitton, Kenzo and Pandora.
From a consumer perspective, there’s a few pointers you need to be aware of:
- The claim back is on the tax only and the rates and values will vary country to country
- Not all products will be Tax Free eligible (e.g., large purchase items such as cars or costs including hotel/restaurant bills)
- Not all stores participate or offer this service, so look for the logos and if it’s not clear, don’t be afraid to ask
- It is only applicable for visitors to the country, and not residents
What’s the Tax-Free claim back process?
- At the point of purchase, you will need to show your passport/ID card to show proof of your country of residence
- You will need to complete documentation. This will be either a paper or digital form
- With a paper form, you will need to get it stamped at the customs desk at your point of exit. You will need the form and the receipt, and it can take time, so you might need to give yourself a time buffer at the airport. Once you are airside, you can then go to the tax-free counter and collect the refund.
- With the digital form, the submission is instant, and the refund is immediate. This is becoming a more popular means to claim back the tax, but not all businesses will have this option.
Finally – is it worth claiming back the tax? It’s probably dependent on the amount you can claim back.
As an example (and based on current rates at time of writing) if you bought a watch for €2,000 in France, the tax back is approx. 12% and that’s €240… so in this instance… definitely!
Either way being aware of this under-utilised service can only benefit you and your wallet. For more information on Innova and their services – take a look at their website and take advantage of their store locator for the different countries – it will help you to shop smartly!
For more on shopping tips… our blog “How to shop safely online” will give you all the best tips to staying safe online!