Ultimate Guide to Tax free Shopping in Italy
Tax free shopping is available in Italy! Non-EU residents can enjoy traveling and saving on purchases made during their visit to Milan and around Italy.
Whether you like petite luxury boutiques, mega shopping malls or love the deals found at designer outlets, tax-free shopping offers extra value for any fashionista.
Tax free shopping is a way of shopping where the customer is exempt from paying certain taxes on the items that they purchase from a store. This type of transaction only takes place at stores that have been registered as having tax-free privileges under EU laws. In Italy, visitors who are permanent residents in non-EU countries can shop and get reimbursed for the taxes.
There are thousands of stores in Milan and around Italy offering tax-free shopping. These are very common in the center of larger towns and cities in Italy.
In this guide we will answer the questions
- What is tax free shopping?
- Where to shop tax free in Milan?
- Who is eligible for tax free shopping?
- How does tax free shopping work?
- How to get a tax refund on tax free shopping items?
- What’s the difference between Tax-free and Duty free shopping?
What is Tax-Free shopping in Italy?
Sales tax in Italy is referred to as IVA (Imposta sul Valore Aggiunto) or VAT (Value added Tax).
The standard VAT rate is 22% and is applied to goods such as fashion, textiles, leatherwear, jewelry, glassware, sunglasses, wines and other alcohol.
Some items have lower tax rates such as:
- 4%, food, beverages and agricultural products
- 5%, for some foods
- 10%, for the domestic electricity and gas supply, medicines, other goods and services.
An extensive table of items can be found on the Italy Department of Finance website, def.finanze.it.
Tax free shopping offers a tax refund to non-EU residents on goods bought with IVA tax within 3 months prior to departure. Only non-European residents may benefit from a tax refund.
As of its EU-exit date, residents of the UK can now also benefit from Tax Free shopping in Italy.
After a visitor makes purchases of €154.94 Euro or more in a certified tax-free store, presents the form and validates it by a customs officer, they may request a cash or credit refund.
There are however exceptions. You will not be refunded for items that have been used or consumed, items shipped overseas as well as for some other items.
- Meals or food eaten during your stay
- Entrances to museums
- Even if new, items of clothing or accessories that have been worn
- Purchased automobiles
Tax Free Shopping in Italy
Shoppers eligible for VAT / Sales Tax Refund from Italy:
Time limit for customs approval:
3 months from the time of purchase
Where can I go shopping tax free in Milan?
Stores display a “Tax Free Shopping” emblem. Boutiques in the historical center of Milan offer tax-free shopping. Shopping centers, department stores and malls will also offer the benefit of tax free services.
However, the best savings and return on your purchases will come from shopping at outlets.
The Scalo Milano Outlet located just 15 minutes from the city center offers 70% savings on retail prices plus provides visitors with tax-free shopping. In partnership with Global Blue and Planet Payment tax free shopping solutions, visitors can collect refunds on the sales tax they paid on purchases at Scalo Milano Outlet & More.
Go home with designer clothing from Italian designer brands and international labels such as Barbuti, Cavalli Class, Calvin Klein, or Murphy & Nye. Shop for jewelry, shoes and accessories from A.Testoni, Borsalino, Braccialini, Converse, Dodo and Swarovski to name a few.
Who is eligible for Tax Free Shopping in Italy?
Anyone over 18 and a permanent residence in a non-EU country is eligible for tax free refunds on shopping in Italy.
According to the EU visitors taxation webpage, (ec.europa.eu/taxation) in some countries, you may also qualify as a ‘visitor’ if you are living in an EU country for a defined period of time for a specific purpose, but your permanent home is outside the EU and you are not intending to return to the EU in the immediate future. EU citizens permanently living in non-EU countries are also eligible for the VAT refund.
Example: Paola is an Italian citizen but lives permanently in Canada. Once a year, she returns to Italy to visit her parents. Paola is a ‘visitor’ and can apply for a refund on a basis of her Canadian residence card.
Can UK residents ask for a tax refund?
The news of the UK’s exit from the European Union has gotten a lot of attention. It has also been followed by many questions and it is not unusual to hear the opinions of people on this topic. The British government, however, has provided some clarity of their plans for after UK withdrawal from the EU.
Yes! As of its EU-exit date, residents of the UK can now also benefit from Tax Free shopping in Italy.
I’m a student living in Italy can I shop tax free while I am living here?
No, not the entire time you are in Italy. If you are planning to return to your home country, for example for summer or holiday break, any items you buy in the 3 months prior to departure are eligible and you may request a tax refund on those items purchased in that period.
How do I prove I am eligible for tax free shopping in Italy?
You must present your passport or an id document with your residential address, in-store when purchasing the goods.
How to Shop Tax Free in Italy
1. Go shopping
2. Validate your purchases
3. Get a tax refund
STEP 1 – GO SHOPPING
When you go shopping in Milan or anywhere in Italy, ask the sales assistance if they offer tax free benefits for visitors. Tax free shopping is available for purchases of a minimum of €154.94 euro.
Usually, the minimum of €154.94 are per each receipt, but receipts can be accumulated to reach the minimum amount if the purchases were made on the same day and in the same store.
If you do not see a tax-free shopping emblem and you want to benefit from a tax refund, always ask if the service is offered before you pay.
Get the Form
At the check-out or boutique cashier, the shop assistant will ask you to provide proof that you are a visitor to the EU. You will need to show your passport or other identity document proving your residence outside the EU.
You will be asked to fill in a form with the necessary details. The shop assistant will fill in the shop’s details on the form.
In some cases, you may be asked to show your ticket as proof that you are leaving the EU within the required time; for Italy this period is within 3 months of purchase date. This is more common at airports and train stations than in city shops and boutiques. Have a copy of your ticket and documents on your mobile, just in case.
You will be asked to pay the full amount of the goods and taxes. Paying the pre-deducted tax-free price at shops is not possible.
On the receipt, there may also be an administrative fee for tax-free shopping services (which will be later deducted from the refunded amount), many but not all stores apply this fee. Ask before paying what administrative fees may apply.
There are services in Italy for tax-free shopping in Italy; Global Blue, Premier Tax Free, Planet Payment and others. By pre-registering with one of these services, your personal details will automatically be filled out on the Tax Free Form making check-out quicker.
STEP 2- VALIDATE YOUR PURCHASES
At the airport, port or station of departure, go to the Customs desk and present your completed Tax-Free Form, passport, receipts and purchases to get a stamp on your form validating your purchases.
Goods should be kept available for customs officer inspection. Items should be new, unused and with the original receipts. Don’t check-in your luggage before getting the customs stamp, unless otherwise instructed.
Without validation you cannot get a refund.
How to get a tax refund on tax free shopping items in Italy
STEP 3 – GET YOUR REFUND
At the airport, port or station, go to the nearby desk or office displaying a Tax-free refund logo. In some cases this may be a currency exchange office.
Present your stamped, completed Tax-Free Form and your travel passport to receive the refund in cash or to your credit card. There is an additional fee of up to €3 euro per receipt for cash refunds.
Will I get all the IVA back?
Italy has one of the highest refund rates in the EU for large purchases, at up to 15.5%.
The rebate will be paid as a percentage of the VAT minus service fees. The refund rate in Italy ranges from 11.6% to 15.5% of purchase amount, with a minimum purchase amount of 154.95 EUR per receipt.
|Less than 1,700 EUR||11.6% – 13.2%|
|1,700 EUR – 3,000 EUR||13.2% – 14.1%|
|3,000 EUR – 5,000 EUR||14%|
|5,000 EUR – 8,000 EUR||15%|
|More than 8,000 EUR||15.5%|
Source Upon IVA calculator
Shopping in Italy
Unlike many countries where items are priced and then you get to the till to find you must pay more for tax, in Italy the tax is already added to the price tag.
So, for example if you find a €700 euro evening gown at the Flavio Castellani outlet store, which had been discounted to €350, the €77 IVA tax has already been added to the price. By requesting a tax rebate, you get an even greater bargain!
The more you shop, the more you save.
Just think of how much you can save by asking a rebate on all the tax-free shopping you do in Milan!
What’s the difference between Tax-free and Duty free shopping?
Duty Free vs Tax free
Duty free shopping is different than Tax free shopping. Duty free goods are free of excise tax applied to the retail price, whereas on Tax free goods the buyer pays the tax and then is reimbursed.
Duty Free, refers to areas where import, sales, value-added, or other taxes do not apply.
Generally, these areas are found in airports, cruise ships, military schools or particular geographical areas.
In the most common case of airports, the sale under the Duty Free regime is accessible in Europe in the so-called Non-Schengen area, i.e. after passport control and only if the customer has a direct ticket outside the EU area. In this case, the customer will be able to buy the items at a fully determined price.
Pro Travel Tips on Tax Free Shopping in Italy
- Always ask before paying if the store offer tax free purchases. You cannot apply for a refund after payment has been made.
- Pre-register for a tax-free service such as Global Blue or Planet Payment to make check out quicker.
- Keep all receipts, scan or photograph them.
- Get to your point of departure early to have time for the refund procedure.
- Have goods available for inspection, do not check in your luggage until you have gotten your validation stamp.
- If you are getting a credit or bank refund, keep a copy (scan or photo) of your validated form in case you need it for proof of purchase.
Have you got a question about tax free shopping in Italy?
Need advice on where to find the best deals? Contact us here.
Shopping at Scalo Milano Outlet & More, Milan Italy – Save up to 70% on fashion and design brands
Scalo Milano Outlet & More is the closest outlet village to Milan and is accessible by a free shuttle bus service.
Getting to Scalo Milano Outlet is easy; there’s a free shuttle bus from P.zza della Repubblica (in front of the newsstand) or from Porta Romana (in front of Corso Lodi, 2) which take about 20 minutes, or take the S13 train which stops in front of the outlet at the Locate di Triulzi station, or going by car or taxi, a 15-20 minute drive from the center of Milan. There is ample parking and a recharging station for electric cars.
For more deals, scan or click on the QR code
Article by Celia Abernethy, Milanostyle.com
This guide is brought to you by Scalo Milano Outlet & More
All images courtesy Scalo Milano Outlet & More
For more info: scalomilano.it/en