How can VAT be recovered? – When employees of a VAT-registered business are required to spend the night in a hotel in the course of their business, the business can reclaim the 20% VAT on the cost of their accommodation. To do so, they need to include the VAT payment in their quarterly VAT return that they file with the HMRC or their annual VAT return if the business operates under the Annual Accounting scheme.
The business must be able to provide proof of the VAT payment through documentation, such as an invoice with the VAT listed separately. In some cases, providing this documentation can be difficult or even impossible. This is particularly the case when booking accommodation through hotel booking websites or corporate travel managers.
Invoices from these intermediaries do not include VAT, because they are covered by a separate set of rules and regulations known as the Tour Operators Margin Scheme (TOMS). The transaction incurs what is known in tax jargon as a “disbursement”, whereby a payment is made to an intermediary rather than to the accommodation supplier directly.
Can you get VAT refund on Hotels in Spain?
General information on VAT refunds for travellers Yes, as long as you reside in a country that does not belong to the European Union, or are resident in the Canary Islands, or in the Autonomous Cities of Ceuta and Melilla, and also meet the following requirements:
Tourists who can prove their identity and residence outside the European Union at the time of purchase. The purchases are documented on an invoice and on an electronic refund document (DER) sent to the Tax Agency. The purchases must have been made on the Spanish mainland or in the Balearic Islands, excluding purchases made in the Canary Islands or in the cities of Ceuta and Melilla. The goods must not constitute a commercial shipment, i.e. they must have been acquired on an occasional basis and intended for the traveller’s personal use or that of their family members or offered as gifts and which, by their nature and quantity, cannot be presumed to be the object of a commercial activity. The goods purchased must actually leave the territory of the European Community within three months of the date of supply.
Similarly, this regime excludes deliveries of goods assigned to the equipment or provisioning of any private means of transport (e.g. tyres and fuel). For the refund of VAT borne by non-resident travellers within the European Union, these must have been previously charged and documented in invoices.The seller must also submit an electronic refund document (DER) to the Tax Agency.
Directly through the shop.The traveller sends the electronic refund document endorsed by Customs to the supplier, who will refund the full amount charged within fifteen days by cheque, bank transfer, credit card or other means of proof of reimbursement.The deadline for the traveller to submit the DER endorsed by Customs to the supplier is the general four-year limitation period for the supplier’s right to rectification of the charged duties.After this time the supplier is not obliged to refund the VAT. Through Collaborating Entities authorised by the Tax Agency.In this case, travellers shall present the electronic refund documents endorsed by Customs to these entities, which shall pay the input VAT on the acquisition of the goods minus the corresponding authorised commission.The traveller must agree to such a return.Subsequently, the Collaborating Entities will send the electronic reimbursement documents endorsed by Customs to the suppliers who will make the corresponding reimbursement, in this case in full.
The reimbursement of VAT to travellers by the Collaborating Entity shall be made by cash, credit card, cheque or bank transfer. Travellers must have their usual place of residence outside the territory of the European Union.As far as evidentiary documents are concerned, there is freedom of evidence.Proof of habitual residence outside the European Union may be furnished by any legally admissible means of proof.It is up to the traveller to prove, by any legally valid means of proof, that he or she is indeed resident outside the European Union.For example, a passport, identity card, certificate of census registration in another country, certificate of registration in the Consular Register of Spaniards residing abroad, “Green Card” or any other resident card from a state outside the European Union.
Citizens of the European Union (i.e. nationals of a Member State with a passport of that Member State) who are permanently resident in a non-EU country can also benefit from the Article 21 exemption.2 of the VAT Act and can claim a tax refund.This is also the case for Spanish diplomatic and consular staff residing in non-EU countries.
The seller shall always check at the time of sale the identity of the traveller and his residence outside the European Union.This obligation must be physically fulfilled by the seller in any case and at the time and place where the purchase is made. At this point, mention should be made of Judgment number 1687/2022 of the Supreme Court, Contentious-Administrative Chamber, Second Section.The Court considers that:”(.) in order to prove the habitual residence of the purchaser, for the purposes of applying the exemption for the export of goods under the travellers’ regime provided for in Article 147.7 of Council Directive 2006/112/EC of 28 November 2006 and 21.2º.A of Law 37/1992 on Value Added Tax, it is not sufficient to provide the passport, as provided for in Article 9.2º.B.b) of Royal Decree 1624/1992 of 29 December, which approves the Value Added Tax Regulations, when the habitual residence or domicile of the recipient of the supplies of goods is not stated therein, and in this case it is also necessary to present other means of proof that prove the habitual residence of the traveller.In any case, it is up to the seller or supplier of the goods, who is the taxable person for VAT purposes, to verify whether the document presented by the traveller in order to benefit from the exemption contains the details of the traveller’s habitual residence or domicile, which may, where appropriate, be the passport, identity card or any other legally accepted means of proof.” The requirements of the Value Added Tax rules to qualify for this tax benefit must be met at the time of accrual (when the goods are made available to the travellers), so that habitual residence outside the European Union must be a fact at that time.
For the purposes of this law, goods carried by travellers shall not be considered to constitute a commercial consignment when they are goods acquired on an occasional basis, intended for the personal or family use of travellers or to be offered as gifts and which, by their nature and quantity, cannot be presumed to be the object of a commercial activity.
The rule does not determine any quantitative threshold above which goods are considered to constitute commercial dispatch.It will therefore have to be analysed on a case-by-case basis. If the traveller chooses to obtain reimbursement directly from the supplier, the supplier shall reimburse the full amount charged within fifteen days by cheque, bank transfer, credit card or other means of proof of reimbursement.
- If the traveller opts for the refund of VAT through a Collaborating Entity authorised by the Tax Agency, the VAT refund to travellers will be made in cash, by credit card, cheque or bank transfer.When the refund is made in cash, it shall necessarily be made in euros.
- The mechanism for refunding value added tax to travellers should be understood as being aimed at goods purchased by travellers and to be transported “in the personal luggage” of travellers, and is therefore not applicable to other cases of goods which are transported to a third territory outside the personal luggage of travellers.Also excluded from the VAT exemption are goods intended for equipment (e.g:tyres, fuel) or refuelling of any means of transport for private use.
Only goods purchased which actually leave the territory of the European Union are eligible for reimbursement.Therefore, the exemption does not apply to services of any kind (accommodation, car rental, catering, etc.).nor to goods which are consumed in whole or in part within the territory of the European Union (beverages, chocolates, perfumes).
It is important to note that the electronic refund document (DER) may or may not be endorsed in its entirety, so that if only some of the goods included in an DER are actually exported, the condition of actual exit of all goods is not fulfilled and will therefore not be validated.If goods are acquired which can be consumed, in order to benefit from the exemption and be eligible for a refund of input VAT, these goods must leave the territory of the European Union in the same state as when they were acquired.The VAT exemption for the supply of goods under the traveller’s system excludes the supply of goods for the purpose of equipment (example:tyres, fuel) or refuelling of any means of transport for private use.
The seller must issue a corresponding invoice and an electronic refund document (ERD), both at the time of purchase.The DER is available at the Electronic Headquarters of the State Tax Administration Agency, in which the goods acquired and, separately, the corresponding tax should be entered.
- The following details of the traveller shall be entered on the electronic reimbursement document:identity, country of residence, date of birth and passport number of the traveller.
- The collaborating organisation or the selling shop must check the endorsement of the DER as a prerequisite for reimbursement.It must also inform the Tax Agency that the refund has been made.
The copy of the form issued (DER) to travellers will carry a CSV (secure verification code) so that the traveller can always know the status of their VAT refund claim at any time.By consulting the procedures on this page. It is important to bear in mind that the DER supplied to the traveller must contain a barcode or QR code for subsequent reading at the time of stamping (the screenshot of the computer screen with which the form is issued to the Tax Agency does not fulfil this requirement).
It is a condition for the refund of input VAT on purchases of goods by non-resident travellers in the territory of the European Union that the goods actually leave the territory of the Union within a maximum period of three months following the purchase.The VAT Directive 2006/112/EC states more clearly that the goods must be transported “out of the Community before the end of the third month following the month in which the supply takes place”.
Deadline:5 May (confirmed by date of invoice) Effective date of departure:Before 31 August.
Spanish invoicing regulations allow entrepreneurs and professionals to issue summary invoices.Thus, different transactions carried out on different dates for the same recipient may be included in a single invoice, provided that they were carried out within the same calendar month.
- Where the sale of the goods being exported corresponds to a summary invoice, the three-month period shall run from the date of the latter document.
- Travellers may request a refund of the VAT paid on their purchases in Spain, provided that they meet all the legal requirements and that the electronic refund document (DER), which accredits their purchase, is correctly stamped by the customs office of departure.
The maximum period for requesting a refund is the general four-year limitation period, coinciding with the period of the supplier’s right to rectification of the charged amounts.After this time the supplier is not obliged to refund the VAT. : General information on VAT refunds for travellers
Can I get refunded for VAT?
Typically, you have to pay the value-added tax at the time of purchase, and then apply for a refund from the shop. Usually, your purchase must be over a certain amount in order to qualify for a VAT refund.
Can you still claim back VAT from UK?
Under European law, you can reclaim Value-Added Tax (VAT) incurred in another Member State from that Member State. You do not have to be established in that Member State. This is done through the Electronic VAT Refund (EVR) system, The Electronic VAT Refund (EVR) System is no longer available to claim:
VAT incurred in Great Britain (GB) by Irish traders or VAT incurred in Ireland by GB traders.
If you have suffered VAT in GB you can request a refund of that VAT. This request must be made directly to Her Majesty’s Revenue and Customs (HMRC) Note The EVR system can be used to reclaim VAT expended on goods in Northern Ireland. To facilitate this, the VAT Directive has been amended.
What is the VAT rate for hotels in the Netherlands?
Dutch VAT rates – The Netherlands has a simple VAT rate structure with only a standard VAT rate and one reduced VAT rate:
Standard rate: 21% Reduced rates: 9%
The Netherlands has opted for the reduced on a number of items allowed by the VAT Directive. Super-reduced rates do not apply in The Netherlands (source: European Commission)
Can I claim VAT on food?
FAQs – Q. I am meeting UK based clients for a business lunch and will be paying the costs in full. Can I claim the VAT I am charged? No. The costs incurred relate specifically to Business Entertainment and therefore no VAT is claimable.Q. During a business trip made to provide business services to an existing customer I met a new client for a business lunch and paid the lunch bill in full.
Can I claim the VAT on my meal? Yes. The cost of the new client’s meal is Business Entertainment so the VAT relating to that meal cannot be claimed but, as the reason for your trip was not for the purposes of the meeting, your meal is considered ordinary subsistence and therefore the VAT on your meal can be claimed.Q.
I am holding a meeting with a client from overseas and will be providing refreshments and a simple buffet as part of the meeting. Can I claim the VAT on the cost of the refreshments and buffet? Yes, the rules restricting the recovery of VAT you incur on the provision of business entertainment does not extend to entertainment provided to overseas clients.
- Additionally, the provision of refreshments and a simple buffet as part of the meeting would be unlikely to be seen as having any private benefit for the overseas client.
- However if you had provided more than refreshments and basic catering to an overseas client, for example a meal at a restaurant or entry to a sporting event, HMRC considers there to be a private benefit to your client.
In these circumstances you would be required to declare VAT on this private benefit and HMRC expects the value of the VAT you declare on this private benefit to be the same as the total value of VAT you have claimed in providing the entertainment. You may therefore instead chose not to claim the VAT on the cost in the first place.Q.
If I hire a hospitality box at the local Premiership football ground and use it to entertain current or potential UK based customers can I claim the VAT on the lease? This is Business Entertainment but generally it is accepted that the cost of the hire of a hospitality box includes an element of business advertising and while you cannot claim VAT on Business Entertainment you can claim VAT on advertising.
More and more suppliers of hospitality boxes are separately showing the charge for the hire of the box and the charge for advertising on their invoice and provided they have done so you can claim the VAT charged on the cost of advertising. However if the invoice shows no separate charge then no VAT can be claimed.
Can you get VAT back on hotels Italy?
At the airport – Get to the airport earlier than usual, as the process might take a while. Bring your VAT forms, your receipts, and, of course, your purchases. Head to the customs office. They will check your goods, your documents, and stamp your VAT forms. If the airport doesn’t offer this service, you’ll need to mail the VAT forms to the address given in the shop, and wait to hear back. You might have to pay duties upon re-entry to your home country.
Which country has the highest VAT refund?
Which Country Has the Lowest VAT Refund? – The countries with the lowest VAT refund are the United Arab Emirates, Taiwan, Oman, and Myanmar which all have a VAT refund rate of 5%.
Can you claim VAT on hotel stays Thailand?
How to claim a VAT refund in Bangkok – Goods must be purchased from stores displaying the ‘VAT Refund For Tourists’ sign. VAT refunds only apply to goods taken out of Thailand within 60 days from the date of purchase. Goods must have a value of at least 5,000 baht (including VAT), and single purchases must have a value of at least 2,000 baht per day.
- On the day of purchase, present your passport and request the sales assistant at the store to complete the VAT Refund Application for Tourists form (P.P.10) and attach the original tax invoice to the form.
- Each application form must show the value of goods of 2,000 baht or more.
- Before departure, present your goods and VAT Refund Application for Tourists form to Customs officers for inspection before check-in.
Luxury goods, such as jewellery, gold ornaments, watches, glasses, or pens must once more be inspected by the Revenue officers at the VAT Refund Office at the departure lounge. You can present your claim to the Revenue officers, mail it back to the Revenue Department of Thailand, or drop it into the box in front of the VAT Refund Office.
Can you claim 100% VAT back?
Claiming VAT back on fuel – The golden rule applies when claiming VAT back on fuel: it must be used solely for business purposes. However, claiming fuel VAT back can be a little more complicated: Claim 100% of the VAT – You can reclaim the full amount of VAT paid on all fuel – including personal use – but you have to pay a fuel scale charge that specific to your type of vehicle.
- The government has a useful Fuel Scale Charge opens in new window tool you can use to calculate the cost.
- Claim 100% on fuel used for business – You can keep a log of business mileage and claim back VAT on the amount of fuel used for the mileage recorded.
- Don’t claim VAT – This is an option for low mileage company vehicles where the fuel scale charge would cost more than the VAT claimed.
However, by not claiming the VAT back on the fuel used by one of your business vehicles, you cannot claim VAT back on fuel used by any of the vehicles in your business.
Who has the highest VAT in Europe?
More than 170 countries worldwide —including all European countries—levy a Value-Added Tax (VAT) on goods and services. As today’s tax map shows, EU Member States’ VAT rates vary across countries, though they’re somewhat harmonized by the European Union (EU), The EU countries with the highest standard VAT rates are Hungary (27 percent), Croatia, Denmark, and Sweden (all at 25 percent). Luxembourg levies the lowest standard VAT rate at 16 percent, followed by Malta (18 percent), Cyprus, Germany, and Romania (all at 19 percent).
- The EU’s average standard VAT rate is 21 percent, six percentage points higher than the minimum standard VAT rate required by EU regulation,
- Generally, consumption taxes are an economically efficient way of raising tax revenue.
- To minimize economic distortions, there is ideally only one standard rate that is levied on all final consumption, with as few exemptions as possible.
However, EU countries levy reduced rates and exempt certain goods and services from the VAT. One of the main reasons for reduced VAT rates and VAT-exempted goods/services is the promotion of equity, as lower-income households tend to spend a larger share of income on goods and services such as food and public transport.
Other reasons include encouraging the consumption of “merit goods” (e.g., books), promoting local services (e.g., tourism), and correcting externalities (e.g., clean power). However, evidence shows that reduced VAT rates and VAT exemptions are not necessarily effective in achieving these policy goals and can even be regressive in some instances.
Such reduced rates and exemptions can lead to higher administrative and compliance costs and can create economic distortions. A recent study shows that scrapping VAT reduced rates in EU countries will allow standard rates to drop under 15 percent. To address equity concerns, the OECD instead recommends measures that directly aim at increasing poorer households’ real incomes.
|VAT Rates Among European Union Member States and the United Kingdom, as of January 2023|
|Country||Super-reduced Rate (%)||Reduced Rate (%)||Parking Rate (%)||Standard Rate (%)|
|Austria (AT)||–||10 / 13||13||20|
|Belgium (BE)||–||6 / 12||12||21|
|Croatia (HR)||–||5 / 13||–||25|
|Cyprus (CY)||–||5 / 9||–||19|
|Czech Republic (CZ)||–||10 / 15||–||21|
|Finland (FI)||–||10 /14||–||24|
|France (FR)||2.1||5.5 / 10||–||20|
|Greece (GR)||–||6 / 13||–||24|
|Hungary (HU)||–||5 / 18||–||27|
|Ireland (IE)||4.8||9 / 13.5||13.5||23|
|Italy (IT)||4||5 / 10||–||22|
|Latvia (LV)||–||5 / 12||–||21|
|Lithuania (LT)||–||5 / 9||–||21|
|Malta (MT)||–||5 / 7||–||18|
|Poland (PL)||–||5 / 8||–||23|
|Portugal (PT)||–||6 / 13||13||23|
|Romania (RO)||–||5 / 9||–||19|
|Slovenia (SI)||–||5 / 9.5||–||22|
|Sweden (SE)||–||6 / 12||–||25|
|United Kingdom (GB)||–||5||–||20|
|Notes: When one of the major EU VAT directives was adopted in 1991, some EU countries were applying reduced, super-reduced, or zero rates to goods and services that were not specified by the new regulations as falling within the zero-rate or reduced-rate categories. To ease the transition to a standard rate on these goods and services, a so-called “parking rate” was permitted. Although it was intended to be phased out, some countries still apply it. Since April 2022, in order to secure the principle of equal treatment, EU countries can apply two reduced rates not lower than 5 percent to several goods and services, one super reduced rate below 5 percent and one exemption. Source: European Union, “VAT rules and rates,” https://europa.eu/youreurope/business/taxation/vat/vat-rules-rates/index_en.htm#shortcut-5 European Commission, “Taxes in Europe Database v3,”|
How much is tax refund in Amsterdam?
Refund Rates – Netherlands’ refund rate ranges from 7.8% to 15% of purchase amount, with a minimum purchase amount of 50 EUR per receipt. Pharmacy goods, food and books You need to be older than 18 and have permanent residence in a non-EU country to be eligible.
|Less than 4,500 EUR||7.8% – 14.3%|
|4,500 EUR – 15,000 EUR||15%|
|More than 15,000 EUR||16%|
Netherlands has one of the highest refund rates for large purchases, at up to 15%. Netherlands has moderate minimum spending requirement, at 50 EUR.
Can tourists claim VAT back in UK 2023?
Budget 2023: British Retail Consortium calls for VAT refunds reinstatement
The industry body said this would be vital to drive tourism “footfall and spend” back on to the UK’s high streets.The scheme that enabled tourists to claim a refund on VAT on goods bought on the high street, at airports and other departure points that are exported from the UK in their personal baggage was abolished by then chancellor, now prime minister, Rishi Sunak in January 2021 following Britain’s exit from the European Union.Retailers have been vocal in their support for the perk to return to boost trade in a time of reticence by consumers to spend due to the cost of living crisis.
Cancellation of the scheme has already claimed casualties, including the Bond Street store occupied by high-end British that closed last month. The accessories maker blamed the “lack of VAT-free shopping in the UK” as a partial factor in the closure of the store.
- Helen Dickinson, CEO of the BRC, said: “To take advantage of the increase in international tourism, we’d like to see the VAT Retail Export Scheme reinstated to boost the UK’s competitiveness driving footfall and spend.
- The UK is currently one of the only European countries without such a scheme.
- We hope the chancellor will build on the positive business rates announcements from the Autumn Budget to provide a roadmap to longer-term reform, including a plan to return the multiplier to a more sustainable long-term level.
This would encourage growth and show the UK is a great place to open new stores, boosting investment and jobs.” Dickinson also called for a “fix” to the “broken” apprenticeship levy that allows retailers to invest more effectively in training a “higher-skilled, more productive and better-paid workforce”.
Is the UK Tax Free Shopping for EU citizens?
No Tax Free Shopping in The UK Tax Free shopping is now only available for goods purchased in the UK and sent directly to overseas addresses, including the EU.
Can you claim VAT back from Spain?
The Spanish government has removed the minimum amount of €90.16 that previously applied to Tax Free Shopping transactions made in the country. This means that, whatever the value of the goods you purchase, you now have the right to claim back the VAT. The new regulations came into effect in July 2018.
What is the current VAT on Hotels UK?
Accounting for supplies that straddle the temporary reduced rate – In most cases, you will simply account for VAT at:
- 5% for supplies made between 15 July 2020 and 30 September 2021
- 12.5% for supplies made between 1 October 2021 and 31 March 2022
However, there may be situations where you received payments or issued invoices before 15 July 2020 for supplies that took place on or after 15 July 2020. More information about this can be found in sections 30.7.4 to 30.9.2 of VAT guide (VAT Notice 700),
How much is VAT on hotel stays UK?
How HMRC uses your information – Find out how HMRC uses the information we hold about you. Published 8 June 2013 Last updated 5 August 2022 + show all updates
- 5 August 2022 The temporary reduced rate of 5% that was applied to tourism and hospitality has been corrected to July 2020. The end of the temporary reduced rates has been corrected to 31 March 2022.
- 1 April 2022 The temporary reduced rate which applied to tourism and hospitality ended on 31 March 2022. From 1 April 2022 the normal VAT rules apply, and VAT should be charged at the standard rate.
- 5 October 2021 The government has extended the reduced rate of VAT for tourism and hospitality.
- 3 March 2021 We have added information about government legislating to extend the temporary reduced rate of VAT.
- 3 December 2020 This notice has been updated to reflect the VAT reduced rate for tourism and hospitality has been extended from 12 January to 31 March 2021.
- 21 July 2020 Section 5 has been updated with information about holiday accommodation qualifying for the temporary reduced rate.
- 9 July 2020 The notice has been updated to reflect the changes announced on 8 July 2020 regarding the temporary reduced rate of VAT on certain supplies to hospitality, holiday accommodation, or charge for admission to certain types of attractions.
- 27 February 2019 Following the measure on ‘unfulfilled supplies’ announced in the Budget 2018, section 7 on guidance relating to deposits and prepayments has been amended.
- 8 June 2013 First published.
What is the tax refund rate for tourists in the UK?
Refund Rates – UK’s refund rate ranges from 4.3% to 16.7% of purchase amount, with a minimum purchase amount of 30 GBP (33 EUR) per receipt (25 GBP for Premier Tax Free locations). Cars, boat, unmounted gemstones and large bullion You need to have permanent residence in a non-EU country or intend to leave UK for a non-EU destination by the end of the 3rd month after the month of purchase to be eligible.
|Less than 400 GBP||4.3% – 12%|
|400 GBP – 4,000 GBP||12% – 14%|
|4,000 GBP – 15,000 GBP||14%|
|More than 15,000 GBP||Around 16.7%|
UK has one of the highest refund rates for large purchases, at up to 16.7%. UK has one of the lowest minimum spending requirements,30 GBP is equal to approximately 33 EUR. UK has one of the lowest refund rates for small purchases, Nearby: France at 12%.
Does Premier Inn charge VAT?
Are the rates shown on this website per person or per room? – Our rates are per room, per night. They include VAT. Meals are not included in the room price. When you book, we’ll give you a total price for the rooms and number of nights you’ve requested.