VAT Refunds for U.S. Companies Traveling Internationally

A clear, practical guide for American businesses reclaiming VAT on travel and events in Europe and the U.K.

U.S. companies are often surprised to learn that international business travel can generate substantial refundable tax. This is because many countries outside the United States use a value added tax system, and foreign businesses do not necessarily lose this VAT when they travel for legitimate commercial purposes. When American staff attend conferences, visit suppliers, participate in training, explore new markets, or meet international partners, the associated travel expenses very often include VAT. This VAT can be reclaimed in many cases, even when the company is not registered for VAT abroad.

Most U.S. businesses do not realize this. The assumption is that VAT is simply a cost of doing business, and since the United States does not operate a federal VAT system, finance managers often believe that nothing can be done. The result is that U.S. firms leave millions of dollars unclaimed every year. Larger enterprises with international teams understand the rules, but small and mid-sized companies, boutique consultancies, travel agencies, event organizers, and investment firms are still losing significant recoveries because the rules feel unfamiliar.

This guide explains how VAT refunds work for American companies, why they exist, what expenses qualify, and how a U.S. entity can recover VAT from Europe and the United Kingdom. It is written for businesses that travel internationally, for finance teams who want to reduce the real cost of global travel, and for entrepreneurs who travel abroad for board meetings, negotiations, conferences, or due diligence. The objective is to show what is possible, what is allowed, and how to claim VAT in a compliant and efficient way.

Understanding how VAT refunds work for foreign businesses

When employees travel abroad, they incur expenses in countries that apply VAT to almost every commercial transaction. This includes accommodation, meals, transport, venue charges, and event fees. Local businesses charge VAT on these costs because they are required to under their domestic rules. However, VAT systems are designed so businesses do not bear the tax when they use goods and services for their own commercial activities. The principle is that VAT should be neutral to business. For foreign companies that are not registered for VAT locally, a refund mechanism is used instead.

There are two broad frameworks that allow a U.S. company to recover VAT. The first is the European Union’s Thirteenth Directive refund scheme. The second is the United Kingdom’s Refund Scheme for Foreign Businesses. (note - The UAE has its own foreign business refund process so contact us to check the latest news on this, and we can confirm full eligibility). All operate on the same principle. A U.S. company submits a claim showing valid invoices, proof of business activity, and evidence that the expenses were connected with commercial work rather than private travel. After review, the VAT authority refunds the eligible VAT directly to the business. The company does not need a local tax registration, nor does it need a local office. It simply needs to demonstrate that it is a legitimate business and that the travel was undertaken for genuine business reasons.

This mechanism exists because countries want to encourage cross-border trade, conferences, exhibitions, and international business development. They also want to remove tax barriers that distort global investment. The system is well established, and American companies have been using it for decades. What has changed is the global growth of conferences and events, increasing travel to destinations like Milan and London, and the rising cost of international accommodation. These trends mean the potential refund amounts have grown significantly in recent years.

Which U.S. businesses qualify for VAT refunds

VAT refunds are available to a wide range of American entities. Corporations, LLCs, partnerships, and professional firms can all claim as long as the travel is undertaken for business purposes. A company does not need to be large, and it does not need international operations. A small consultancy attending a training event in Amsterdam is just as eligible as a multinational with offices across the world. What matters is that the entity is carrying on a genuine commercial activity and that the travel has a business objective.

The review process focuses on the substance of the trip. If the purpose is to attend a conference, meet potential clients, carry out site visits, perform research, or participate in an industry exhibition, the underlying reason is commercial. If the trip is primarily personal, the VAT is not recoverable. The rules are clear, and they are designed to separate business activities from private leisure. U.S. companies often fall into the category of businesses with high travel spend but no established VAT reclaim process. This means recoveries are frequently missed simply because the finance team is unaware of the opportunity or assumes the documentation will be difficult to gather.

Entrepreneurs and small business owners sometimes assume these rules apply only to large corporates. In reality, sole-member LLCs, boutique investment firms, and independent consultants are some of the biggest beneficiaries. They travel frequently, book premium accommodation, and pay full VAT on every hotel, event, and meal. When these trips are linked to genuine work, the VAT is fully recoverable. The key is being able to document the business purpose if the VAT authority requests clarification.

Types of expenses U.S. companies can reclaim

The expenses that qualify for VAT refunds vary by country, but several categories are consistently eligible. The most significant component is accommodation. Hotels in Europe routinely apply high VAT rates, often between 10 percent and 22 percent, depending on the country. In the United Kingdom, hotel accommodation includes a 20 percent VAT charge. The UAE (if applicable) applies 5 percent VAT on accommodation as well. For companies sending teams to events, conferences, or client sites, this becomes one of the largest recoverable amounts.

Conference and exhibition fees are fully eligible in nearly every jurisdiction that offers refunds. This includes major events in Amsterdam, Barcelona, London, Paris and Berlin. Many companies spend thousands on entry fees, sponsorships, and exhibition stands, all of which attract VAT. These costs can be recovered as long as the company documents the business nature of the event.

Transport is partially eligible depending on the country. Taxi services in many European cities are subject to VAT. Train tickets often include VAT that is reclaimable. Car rental frequently includes both VAT and additional charges that may qualify depending on the nature of the travel. Meals are treated differently. Some countries allow partial recovery, and others disallow meals entirely. This is a local rule rather than a global standard. Venue hire, meeting rooms, equipment rental, and professional training fees are also recoverable in most jurisdictions.

Airfares are generally zero-rated for VAT, so there is nothing to reclaim on the ticket. However, ancillary services such as airport lounges, upgrades, or change fees can occasionally include VAT depending on the carrier and location.

Private travel, family trips, and leisure expenses remain fully non-recoverable. This distinction is central to the refund system and should guide how companies categorize international travel.

How the refund process works in practice

Although the rules vary slightly by country, the overall process is consistent. A U.S. company gathers its invoices and supporting documentation for a specific claim period, typically one calendar year. Invoices must meet the local VAT requirements, which usually include the supplier’s VAT number, a clear description of the service, the VAT amount, and the business’s name. Credit card receipts alone are not acceptable. Original invoices or compliant digital invoices are required.

The company submits a refund application directly to the local tax authority or through a representative. The claim is reviewed, which can take several months depending on the jurisdiction. Authorities may request additional information to verify the business nature of the activity or to confirm that the expenses were not connected with private travel. Once approved, the VAT is refunded directly to the company’s bank account.

If you are applicable for a UAE refund, the UAE operates an annual refund cycle, and claims must be submitted within six months from the end of the calendar year. The U.K. requires claims to be made by the end of December for the previous refund year. EU countries operate deadlines under the Thirteenth Directive, which normally require claims to be submitted by 30 June of the following year. American companies need to be aware of these timelines to avoid losing eligible VAT through late submission.

Documentation requirements are strict but manageable. Companies that travel regularly often benefit from implementing a structured process to capture invoices at the point of booking, rather than trying to gather documents months after the trip. When the process is handled correctly, refund rates are high and audits are straightforward because the business purpose is clear.

Common challenges for U.S. companies

American businesses face several practical obstacles. The first is invoice quality. Many hotels issue simplified invoices that do not contain the supplier’s VAT number or the required details. These need to be corrected before a refund claim can be submitted. Companies are often unaware of this and assume their receipts will be accepted. The second challenge involves corporate cards and travel management systems. Digital receipts are not always compliant under European VAT rules unless they meet specific standards.

The third challenge is misclassification of expenses. If a trip incorporates personal and business elements, only the business portion is recoverable. Companies need to be careful to separate these elements and support the allocation with documentation. The fourth difficulty is identifying which countries offer refunds to U.S. entities. Not all jurisdictions have reciprocal arrangements with the United States, and eligibility depends on local rules. Countries such as Switzerland, Norway, the U.K., and most EU member states do accept U.S. refund claims, but some nations outside these regions do not.

Finally, many finance teams simply do not have the bandwidth to prepare claims in-house. VAT refund submissions require methodical collation of invoices, accurate completion of specific forms, and timely responses to authority queries. This is why companies often outsource the process. It reduces internal workload and ensures that claims meet local compliance requirements.

Why VAT refunds matter for cost control

For companies that travel frequently, VAT can represent a substantial hidden cost. A single conference in Europe can generate several thousand dollars in VAT. Large teams attending a global event may incur tens of thousands. Accommodation for multiple trips over a year adds significantly more. Recovering this VAT lowers the real cost of travel and improves profitability, especially for businesses with regular international engagements.

For travel agents, event planners, and corporate travel specialists, VAT refunds can also be built into client reporting. When agencies manage travel for corporate clients, reclaiming VAT adds measurable financial value and positions the agency as a strategic adviser rather than simply a booking provider.

For entrepreneurs and small businesses, VAT recovery transforms international travel from a pure cost into something far more manageable. It also encourages proper record-keeping, which benefits the company’s wider financial reporting.

Using VAT refunds strategically

When managed well, VAT refunds become part of a wider strategy for controlling the cost of global travel. Companies that operate internationally can use VAT recovery to improve budgeting, support more accurate pricing decisions, and strengthen their investment in overseas markets.

Businesses entering new regions can incorporate VAT recovery into their financial models. If a company is exploring opportunities in the Middle East, attending exhibitions in the UAE, or building supplier relationships in Europe, the VAT that would otherwise be lost can be recovered and reinvested. For companies scaling globally, VAT recovery becomes a practical lever for managing working capital.

Conclusion

American companies that travel internationally often leave significant VAT unrecovered simply because the rules feel unfamiliar or because the administrative burden appears complicated. The reality is that VAT refunds are a normal, legitimate part of doing business abroad. The systems are designed for foreign companies, and the largest travel and event destinations operate clear refund mechanisms.

When the process is managed properly, a U.S. business can recover VAT on international accommodation, conferences, exhibitions, transport, and related travel expenses. This reduces the true cost of travel, improves profitability, and creates a more structured approach to global work. For companies that travel regularly, VAT refunds are not an optional extra. They are a financial opportunity that should be incorporated into annual planning and supported with a clear, repeatable process.

Contact us for a free review.

References

• European Commission. 2024. Thirteenth VAT Directive Refunds for Non-EU Businesses. Available at:
  https://taxation-customs.ec.europa.eu/guide-vat-refunds_en

• European Commission. 2023. VAT Refund Rules for Non-EU Established Businesses. Available at:
  https://taxation-customs.ec.europa.eu/vat-refund_en

• HM Revenue & Customs (HMRC). 2023. VAT Refunds for Non-UK Businesses (VAT65A Scheme). Available at:
  https://www.gov.uk/guidance/vat-refunds-for-non-uk-businesses-using-the-vat65a-scheme

• HM Revenue & Customs (HMRC). 2024. VAT Notice 700: VAT Guide. Available at:
  https://www.gov.uk/government/publications/vat-notice-700-the-vat-guide

• Federal Tax Authority (UAE). 2024. VAT Refunds for Foreign Businesses. Available at:
  https://tax.gov.ae/en/FAQ/ForeignBusinessRefunds.aspx

• European Parliament. 2023. VAT Rates Applied in EU Member States. Available at:
  https://www.europarl.europa.eu/factsheets/en/sheet/93/vat-rates

• Organisation for Economic Co-operation and Development (OECD). 2023. Consumption Tax Trends. Available at:
  https://www.oecd.org/tax/consumption-tax-trends-19990979.htm

• KPMG. 2024. Global VAT Guide. Available at:
  https://kpmg.com/xx/en/home/services/tax/global-indirect-tax/global-vat-gst-essentials.html

• Deloitte. 2024. Guide to Indirect Tax Refunds for Non-Residents. Available at:
  https://www2.deloitte.com/global/en/pages/tax/articles/global-indirect-tax-guide.html

See our specialist pages
Global VAT Reclaim - Recover the Tax you’ve already paid abroad
UK VAT Reclaim for U.S. and Global Businesses
EU VAT Reclaim for U.S. and Global Businesses
UAE VAT Reclaim for U.S. and Global Businesses
International VAT Reclaim

Disclaimer:
Content published by Antravia is provided for informational purposes only and reflects research, industry analysis, and our professional perspective. It does not constitute legal, tax, or accounting advice. Regulations vary by jurisdiction, and individual circumstances differ. Readers should seek advice from a qualified professional before making decisions that could affect their business.
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