Easy to understand - what possibilities exist to get a refund - how much money will be refunded - what are the dangers - what are the benefits
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If you are planning to buy a nice watch in Switzerland you can save some money with VAT refund. We show you what possibilities you have, how much you can save and what the dangers are…
We talked to Janette Cammerata from one of the leading luxury watch dealer Beyer in Zürich to get first-hand information. Basically there are two ways of getting a VAT refund.
1. Use established providers
a. A lot of stores in Switzerland work with specialised VAT refund companies like Global Blue Refund or similar companies. They have established processes and it makes your life easy – but there is a cost attached to it…
b. So instead of refunding the full 8% VAT these companies take their share for their service. At Global Blue Refund you will get a 6,4% refund.
c. And this is how it works: mostly in the entrance area you will see their company logo or you ask in the store. Once you purchase you will be provided with a form, fill it out and you will get the watch directly 6,4% cheaper !
2. VAT Refund with direct tax refund
a. Some stores want to offer their clients more and special service – it is more complicated for the stores but it will guarantee you a better refund of the full 8%.
b. And this is how it works: in this case the retailer will deduct the 8% straight from the purchasing price, but will keep the VAT refund blocked on your credit card. You will be provided with the official Swiss customs form and at the airport or at any boarder you have to ask the Swiss custom people to give you the official stamp. Then return the form to the retailer and you have saved 8% !
But there is one thing you have to be aware of – when you go back to your country you are obliged to pay the VAT of your country… So in China you would need to pay 35% of luxury tax, in Germany 19% VAT, etc.
Of course you can wear your watch on your wrist and pretend that this watch was purchased a long time ago in your country… but this is illegal!… in some EU countries, Taiwan and China the customs work with the Swiss customs… and when you get caught then it gets expansive since you pay the VAT of your country and in most cases a fine of 50% of the value of your purchased goods… Outsch!!!
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