- Following the UK’s exit from the EU, British residents from England, Scotland and Wales are now eligible to shop tax free in Portugal stores, starting 1st January 2021.
- With more than 2.1 million UK tourist visits to Portugal in 2019, British tax-free shoppers represent a powerful opportunity for local merchants.
- Tax Free shoppers from the UK will follow the same eligibility criteria and refund process as any other tax free shopping nationality.
With the UK’s exit from the EU finalised on December 31st 2020, UK residents from England, Scotland and Wales will be able to claim a VAT refund on retail purchases made in Portugal, starting from 1st January 2021.
An opportunity to drive in-store spend from British residents
The UK is a major source of tourism for Portugal, with more than 2.1 million British tourist visits in 2019. Their retail activity equated to €79 million spent in Portugal stores, with clothing and accessories and non-specialised retail being the categories with the largest share of British spend.
With the price of goods in Portugal being on average 5-10% cheaper than in the UK, combined with the additional savings offered by tax free shopping, the purchase power of UK shoppers in Portugal is set to increase up to 20%, creating a strong opportunity for local retailers to maximise their in-store revenue.
How does Tax Free Shopping work for UK residents visiting Portugal?
British residents from England, Scotland and Wales will be classified as non-EU residents and will be subject to the same eligibility criteria as any other tax free shopping nationality.
- Reside in England, Scotland or Wales. British nationals residing in Northern Ireland, or within the EU are not eligible to shop tax free in Portugal (proof of residency is required).
- Meet the minimum spend criteria of €50+VAT
- Export the unused goods outside of the EU within a three-month period.
Tax free shoppers from the UK will need to show their passport together with a separate document providing proof of address, to confirm they reside in England, Scotland of Wales. Once eligibility is determined, British tax free shoppers will follow the usual process of completing a tax free form, which will be validated at customs when they leave the EU (before they return to the UK).