Tax-free shopping to end

At the end of September, the government announced the end of the VAT Retail Export Scheme (VAT RES) with effect from 1 January 2021.

This means that overseas visitors will no longer be entitled to a VAT refund on items they buy in England, Scotland or Wales which they take home in their luggage. The decision was made after a public consultation which addressed several key questions regarding VAT RES. However, the change does not mean the end of VAT-free sales.

Retail export
If you’re a retailer, you will still be allowed to offer VAT-free shopping (zero-rated) to non-EU visitors who buy items and have them sent directly to their overseas address, subject to the usual rules.

From 1 January 2021 visitors to the UK will no longer be able to claim VAT refunds on their retail purchases. However, you will still be able to zero rate goods which you sell to customers and send directly to an address outside of the EU.