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VAT Retail Export Scheme

Certain places we regard as part of "home", such as the Channel Islands, do not raise VAT on purchases.  Residents of these places who purchase goods here for installation there, are entitled to have their VAT refunded.  This also applies to countries outside the EU.  In order for this to happen, a procedure must be followed very strictly (this applies to private individuals buying goods for their own use, businesses must use a different procedure).  The purchaser must be here in person.  We will raise an invoice, including VAT, with the words "Retail Export Scheme" on it, and give you a form VAT407, which must be completed here.  You must provide proof of your address in the VAT free area, with a passport, driving licence, ID card or similar.  You pay us the value of the invoice including the VAT, and collect your goods.  At the port of departure, the goods are made available for inspection, a cheery customs officer takes the form 407, stamps it and returns it to us.  We then refund the VAT, usually by crediting the card used originally.  If you plan to use this scheme, let us know in advance so we can make sure we have some forms available.

What happens in practice when leaving for the Channel Islands is that there is no customs officer present.  The form is placed in a box in the customs shed, and processed later.  Put the form in an envelope together with another stamped envelope with our address on it.  If you remind us at the time of purchase we will give you this.  I would also recommend making a photocopy of the form before leaving it.

The following is the experience of Anthony Stagg, one of our customers from Guernsey:

"Hi Simon

Sorry for not coming back sooner.

OK how the system seems to work. The south coast Customs is now unified into one department. This means that the staff can be working in any port – Portsmouth, Weymouth, Poole, Dover etc. They are thinly stretched and as far as I can tell, (based on Poole) have no time or interest in actually checking the goods on the way out of the country. This is despite what the form 704 said.

When I spoke to them as I left the country, they said the 704 had to be put in a post box in the Customs shed. This is as you leave the docks and are heading for the boat. It was a green box attached to the shed. You couldn’t do it until you were leaving as Customs wanted to ensure you actually were leaving the country with the goods.

Then, in theory, all Customs can do is stamp it and return the form to the retailer. This shouldn’t take too long in theory but they reckoned 4 weeks minimum. The forms are processed in their admin centre, which is based in Dover (this is, as I said, for all south coast ports). However the staff who actually man the ports are based in Plymouth.

There is no monitoring system internally inside Customs to allow anyone to see where the forms are. It is fairly pointless ringing any of the helplines as they only trot out the same old comments. There is no point in trying to ring the port you left to see what happened to you form as it will probably not be manned, and besides, as the staff are rotated, even if you were to speak to someone, they wouldn’t be able to tell you anything. I did speak to Dover, without realising they did the processing, but they didn’t really understand what I was on about and put me through to another office. When I did lots of ringing around, it took 6 or 7 phone calls and about an hour to achieve nothing.

My recommendation is to leave it 4 – 5 weeks. That seems to be their recommended service minimum. Make sure the form goes in the right box at Customs and forget about it. Then, if nothing has come through (at the retailer’s end), then try calling Plymouth Customs.  

This page is the important one as it gives you the complaint procedure, which is something I used when I was getting nowhere. I got results within hours after saying I wanted to make a compliant.


The general Plymouth contact details are below.


Phew! I hope this helps. Thanks again for all your help and the quick repayment of the VAT!




Thanks for this information, Anthony.

Note that this procedure is not available to people living in France, Spain, or any other EU country which charges VAT.

Please also note that we cannot refund VAT until we receive the stamped form back from Customs.  There is nothing we can do to hasten the process, and it is up to you to resolve any issues with them!  For a more complete understanding of this procedure see the C&E website at http://customs.hmrc.gov.uk


Send mail to SW@eco-nomical.co.uk with questions or comments about this web site.
Last modified: 30-06-10