I feel like a lot of you guys were waiting on this post! In case you missed it, I went to Europe for the first time ever in April! My best friend and I went to Paris for 4 days and Barcelona for 3 days. I can tell you this much, I am definitely going back to Paris for my birthday!
In Paris, we shopped like there was no tomorrow. By that I mean we were in designer boutiques all day long, every day. It might seem excessive, but we are both the same person when it comes to shopping so it’s ok. The main reason why we shopped so much was because of the VAT!
FULL DISCLOSURE:
I am not rich at all. I really wish I was but I am not yet. All the things I bought was with my money, not anyone else’s. I save up for all my designer purchases and prefer to pay for them in cash so I don’t get in debt over them. That’s just my taste, but sometimes I take the L.
What is VAT?
So VAT is Value Added Tax and this basically our tax in the U.S. that’s automatically included in the price of the good in Europe. If you’re a non-European citizen, you are eligible to get the VAT refunded! Very similar to people who are tax exempt and how they don’t have to pay tax on items purchased here. However, it’s only valid on purchases over 175 euros.
The VAT rate depends on the country: in France I believe it’s 15% but on our paperwork it said 20%. I know Great Britain has a 20% rate for sure. So in essence, it basically is a 20% discount of sorts! When you purchase an item, the company will ask for your passport – we showed a picture of ours. The picture may not always fly, at Goyard I had to have my passport and luckily, I did as we were leaving that day!
The sales associate will first explain the VAT form to you. This form is very very important. I took a picture of all mine as there is only 1 copy, and that copy is sent to the refund offices. This form will have the items you bought, the price you paid, and the VAT you will be getting back. It will also show if you choose to get your VAT back in cash or card.
Then the SA will finish ringing you up and ask for payment. They usually give 2 receipts: one is the original and for you to keep. The other is a duplicate and needs to be mailed in with the VAT form. Once that’s done, you’re basically good to go!
Euro, Conversion, and Pricing
Currently, $1 is equal to .89 Euros, so they’re almost the same but the euro is less. This is very important when you go to purchase anything abroad! Obviously, the less the Euro is in comparison to the dollar is better, but if it’s higher you may not get as good of a deal.
With the Euro being less than the dollar, that means that the prices of a good are cheaper in Europe than they are here. For example, my best friend got her first Chanel Boy. Here it is about $4,900 without tax; in Europe the price was about 4,100 euros. That’s about $4,600, a $300 automatic price difference! So pricing is already a win if you are ineligible for the VAT.
Another point I need to mention is the way you pay. My card – both my debit and credit – asked me if I wanted to pay in Euros or Dollars. I always picked euros because it much cheaper than paying the transaction and conversion fees if you don’t have a travel card! Sometimes your bank may not have a great conversion rate compared to the day’s rate, so definitely be weary of what to select.
Sending the VAT Forms
Once you have everything you need, it’s time for some organization. As previously mentioned, I took pictures of everything. All the forms, receipts, my things! You will submit your VAT forms at the airport you leave Europe from. In our case this was Barcelona. Because our purchases were out of the country, we had to go to the counter there.
A lot of websites I read said to have all your stuff with you to show the officers just in case. I already keep my expensive things with me in my carry-on so it wasn’t a problem for either of us.
I cannot even tell you how quick this process was. I don’t know if it’s because of the time we got there or what, but the officer didn’t even look at me. She just stamped away! I had 4 forms total, so I got them out and we were done in about 2 minutes.
Barcelona Airport had a “mailbox” right by the office to send our forms. Each form comes with an envelope and instructions on what to do. We sealed them and sent them off, and that was that!
When to expect your VAT on Card
So it’s now been about a month or 5 weeks since we dropped our forms off. I have gotten 2 out of 4 refunds. You can track your refund but I’m not 100% sure of the accuracy. Some of the bigger, more known companies will get them to you quickly, like Global Blue. As of now, I’m still waiting but I cannot wait until my credit card bill goes down some more!
If you have any other questions, feel free to leave a comment! I will post about all the things I got by next week!
