Key Takeaways
Overview
The Downtown VAT Refund is an initiative that allows tourists who are departing Thailand to claim a refund on the Value Added Tax (VAT) they have paid on their purchases. This program is designed to provide a financial incentive for tourists to shop in Thailand and promote the country as a shopping destination. However, not all tourists are eligible to claim a VAT refund, and there are certain conditions that must be met in order to qualify for the refund. Additionally, there are specific payment methods for receiving the refund, and there are several reasons why a VAT refund may be disapproved.
Who can claim a VAT refund?
In order to be eligible to claim a VAT refund, tourists must meet the following criteria:
1. Non-Thai nationality: Only tourists who are not Thai citizens are eligible to claim a VAT refund. This is to ensure that the program benefits foreign visitors to Thailand.
2. No domicile in Thailand: Tourists must not have a permanent residence in Thailand. This requirement is in place to prevent Thai residents from taking advantage of the VAT refund program.
3. Not an airline crew member departing Thailand on duty: Airline crew members who are on duty when departing Thailand are not eligible to claim a VAT refund. This is because they are exempt from paying VAT on their purchases due to their professional status.
4. Depart from an international airport: Tourists must depart Thailand from an international airport in order to be eligible for a VAT refund. This requirement ensures that the VAT refund program is only available to tourists who are leaving the country.
5. Purchase goods from stores displaying a “VAT REFUND FOR TOURISTS” sign: Tourists must make their purchases from stores that participate in the VAT refund program. These stores will display a sign indicating that VAT refunds are available for tourists.
6. Present the goods and VAT Refund Application for Tourist Form (P.P.10) and original tax invoices to the Customs officer before check-in at the airline counter on the departure date: Tourists must present their purchases, along with the VAT Refund Application for Tourist Form (P.P.10) and original tax invoices, to a Customs officer for inspection before checking in for their flight. This is to verify that the goods are eligible for a VAT refund.
VAT Refund for Tourists conditions
In order to qualify for a VAT refund, tourists must meet the following conditions:
1. Goods must be purchased from stores displaying the “VAT REFUND FOR TOURISTS” sign: Tourists must make their purchases from participating stores in order to be eligible for a VAT refund.
2. Goods must be taken out of Thailand with the traveler within 60 days from the date of purchase: Tourists must ensure that they take their purchases out of Thailand within 60 days of the date of purchase. This is to prevent locals from making purchases and claiming a VAT refund.
3. Goods must be purchased at least 2,000 baht (VAT included) per day per store: Tourists must spend a minimum of 2,000 baht per day per store in order to qualify for a VAT refund. This requirement encourages tourists to make substantial purchases during their visit to Thailand.
4. Tourists must present their passport and ask the sales assistant to issue the VAT Refund Application for Tourist form (P.P.10) with the original tax invoices: Tourists must provide their passport to the sales assistant at the time of purchase and request the VAT Refund Application for Tourist form (P.P.10) along with the original tax invoices. This is to ensure that the necessary documentation is obtained for the VAT refund.
5. Tourists must present the goods and VAT Refund Application for Tourist form (P.P.10) with original tax invoices to a Customs officer for inspection before check-in: Prior to checking in for their flight, tourists must present their purchases, along with the VAT Refund Application for Tourist form (P.P.10) and original tax invoices, to a Customs officer for inspection. This is to verify that the goods are eligible for a VAT refund.
6. In case of luxury goods (jewelry, gold, ornaments, watches, glasses, and pens of which the value is over 10,000 baht), the tourist is required to hand carry and show the goods again at the VAT Refund for Tourists Office, after passing the immigration checkpoint: For luxury goods with a value exceeding 10,000 baht, tourists must hand-carry the goods and show them to a Revenue officer at the VAT Refund for Tourists Office, after passing through the immigration checkpoint. This is to ensure that luxury goods are properly inspected before a VAT refund is issued.
7. Tourists can claim a VAT refund at the VAT Refund for Tourists Counter at an international airport, or drop the documents into the box in front of the VAT Refund for Tourists office, or mail the documents to the Revenue Department of Thailand: Tourists have several options for claiming their VAT refund. They can visit the VAT Refund for Tourists Counter at an international airport, drop the documents into a designated box in front of the VAT Refund for Tourists office, or mail the documents to the Revenue Department of Thailand.
VAT Refund Payment Methods
The refund payment for VAT refunds can be made using the following methods:
1. Cash (Thai baht only): For refund amounts not exceeding 30,000 baht, the refund payment can be made in cash in Thai baht. This is the most convenient option for tourists who prefer to receive their refund in cash.
2. Bank draft in four currencies: For refund amounts not exceeding 30,000 baht, tourists can choose to receive their refund payment in the form of a bank draft. The bank draft can be issued in four currencies: US dollars, euros, pounds sterling, or yen. This option allows tourists to receive their refund in a foreign currency of their choice.
3. Transfer into Credit card account: For refund amounts not exceeding 30,000 baht, tourists can opt to receive their refund payment by transferring the funds into their credit card account. This option is available for credit cards issued by VISA, MASTERCARD, and JCB. It provides a convenient way for tourists to receive their refund without the need for cash or a bank draft.
For refund amounts exceeding 30,000 baht, the refund payment can be made in the form of a bank draft or by transferring the funds into a credit card account. The specific details for these payment methods are the same as those mentioned above.
It is important to note that there are certain expenses associated with the refund payment, including draft or transfer fees and postal fees. These fees are charged by banks and post offices and will be deducted from the refund amount. The exact rates for these expenses may vary and can be found in the tables provided by the VAT Refund for Tourists program.
Why VAT refunds may be disapproved
There are several reasons why a VAT refund may be disapproved. These include:
1. The claimant carries a diplomatic passport and/or resides in Thailand: Diplomats and individuals who have a residence in Thailand are not eligible to claim a VAT refund. This is to prevent abuse of the program by individuals who are not intended beneficiaries.
2. The claimant is an airline crew member on duty when departing Thailand: Airline crew members who are on duty when they leave Thailand are exempt from paying VAT on their purchases. Therefore, they are not eligible to claim a VAT refund.
3. The claimant did not depart Thailand from an international airport: In order to be eligible for a VAT refund, tourists must depart Thailand from an international airport. Departures from domestic airports or other locations are not eligible for a VAT refund.
4. The claimant did not carry the goods out of Thailand on the departure date: In order to qualify for a VAT refund, tourists must ensure that they take their purchases out of Thailand on the date of departure. Failure to do so may result in the disapproval of the VAT refund.
5. Goods were not taken out of Thailand within 60 days from the date of purchase: Tourists must ensure that they take their purchases out of Thailand within 60 days from the date of purchase. Failure to do so may result in the disapproval of the VAT refund.
6. Goods were taken out of Thailand without being inspected by a Customs officer: Prior to check-in, tourists must present their purchases to a Customs officer for inspection. Failure to have the goods inspected may result in the disapproval of the VAT refund.
7. Luxury goods were taken out of Thailand without being inspected by a Revenue officer: For luxury goods with a value exceeding 10,000 baht, tourists must show the goods to a Revenue officer at the VAT Refund for Tourists Office, after passing through the immigration checkpoint. Failure to do so may result in the disapproval of the VAT refund.
8. The total value of purchase is less than 2,000 baht per day per store: Tourists must spend a minimum of 2,000 baht per day per store in order to be eligible for a VAT refund. Failure to meet this requirement may result in the disapproval of the refund.
9. The VAT Refund Application for Tourist form (P.P. 10) was not issued on the date of purchase: Tourists must ensure that they receive the VAT Refund Application for Tourist form (P.P. 10) at the time of purchase. Failure to obtain this form may result in the disapproval of the VAT refund.
10. The name or passport number on the original tax invoices enclosed with the VAT Refund Application for Tourist form (P.P. 10) does not match the claimant: The original tax invoices must be issued in the name of the claimant and the passport number provided on the VAT Refund Application for Tourist form (P.P. 10). Any discrepancies may result in the disapproval of the VAT refund.
11. The original tax invoices were not enclosed with the VAT Refund Application for Tourist form (P.P. 10): Tourists must ensure that they include the original tax invoices with the VAT Refund Application for Tourist form (P.P. 10). Failure to do so may result in the disapproval of the VAT refund.
12. Goods were not purchased from shops participating in the VAT refund for tourists scheme: Tourists must make their purchases from stores that participate in the VAT refund program. Failure to do so may result in the disapproval of the refund.
13. The tax invoices were not issued from a store mentioned on the form: The original tax invoices must be issued by the store from which the goods were purchased. Failure to provide tax invoices from the correct store may result in the disapproval of the VAT refund.
In conclusion, the Downtown VAT Refund program provides an opportunity for eligible tourists to claim a refund on the VAT they have paid on their purchases in Thailand. However, there are specific eligibility criteria, conditions, and payment methods that must be adhered to in order to qualify for a refund. Failure to meet these requirements may result in the disapproval of the VAT refund. It is important for tourists to familiarize themselves with the program’s guidelines and follow the necessary procedures to ensure a smooth and successful refund process.
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