I was told there is a way to apply for a refund of any VAT I pay while visiting London as a tourist from the US. Is this true? If so, how is this done?

You cannot reclaim VAT on services (hotel, restaurant, car hire etc). The only exception is if you are on a business trip with a business not registered for VAT in UK (so won't apply to most tourists). You can reclaim VAT @17.5% on purchases above certain limit if you complete relevant paperwork in the shop when you pay, and intend to export the goods to a country outside of EU. Most shops in London where visitors are likely to shop offer this service. There's often a sticker on the window (VAT-Free to Overseas Visitors, or similar), but even if there isn't it's worth asking. But there are certain snags. You have to hand in the paperwork at Customs of the last country in EU you depart from. The retailers will deduct a handling charge before they send you a cheque. And it is drawn in pound sterling, so there may be hefty bank charge when you pay in at your home bank. There's an official website at http://www.hmce.gov.uk/notices/704-2.htm. I know some retailers give you money off on the spot if you ask for VAT-free purchase, but it's a simple discount to encourage you to buy, rather than the official scheme.

You have to claim inside the International area at the airport. If you use a credit card for the purchase, you get a credit on the card on about 30 - 60 days, no handling charge deduction. If you collect the forms at the retailer and have them filled out, it is usually quick and painless. If the item you are claiming the refund on is very expensive, it helps (but is not absolutely necessary) to have it with you when you go out (not in checked luggage)

Alec and Dick <BR>Sounds like it's not worth the effort... but thanks for enlightening me.

Bob, it's not really that much effort and is really worth it if you buy a lot things overseas.

I frequently fly to the UK for business and always try to bring something back for the kids. Unless I see something that "calls" to me I usually just wait until the duty free shop at the airport. It's a lot cheapier and easier (though your selection is limited) and I don't have to carry it throughout my travels.

It is not a hassle, and definately worth it depending on what you are spending. My only comment regarding what has been posted is: <BR> <BR>1. have your refund go to your credit card, then you don't have a bank fee associated with cashing a foreign check. <BR>2. don't expect your refund in 30 - 60 days. It depends on who is doing the processing. I have received them that quickly, but more commonly I have experienced 6 months. Just got my refund a couple of weeks ago from a trip in August. <BR>