How to Claim Shopping Tax Refund in South Korea

Traveling through South Korea, a visit to Myeongdong has become mandatory, thanks to its popularity as a shopping destination. Shopping in Myeongdong is not exactly cheap but as we hop from one store to another, we learned something new that might be useful for a lot of juanderers. Shoppers in South Korea can claim refund on Value Added Tax paid for shopping items before leaving the country. 

To enjoy the 10% tax refund, shoppers must purchase at least KRW30,000 worth of items at participating stores. To know if a store is participating, it should have a "Tax Free" store sign or a "Tax Free" print on the receipts. Additionally, shoppers must be foreign visitors who are staying less than 6 months in South Korea or overseas Koreans living over 2 years in a foreign country. Lastly, the purchase must have been made within 3 months of the departure date in South Korea.

Logos of companies offering tax refund service

There are two options of getting a tax refund - availing for an immediate tax refund when making a purchase or applying for a delayed tax refund after a purchase.

In immediate tax refunds, shoppers will not be paying the tax when making the purchase in a tax free store. This requires presentation of passport to avail. However, immediate tax refund applies only to purchases between KRW30,000 and KRW200,000. It is also limited to a cumulative purchase amount of less than KRW1,000,000 for the entire duration of the stay in South Korea.

For single purchases more than KRW200,000 or cumulative purchases of up to KRW5,000,000, delayed tax refund is the option. Although delayed tax refund can also be applied for in purchases starting KRW30,000. 

Shoppers will need to ask for a tax refund slip from the participating stores' cashiers that will be presented when processing the refund. Delayed tax refunds can be processed at major international airports in South Korea or in tax refund booths located in Seoul (also known as downtown tax refund). Airport tax refund kiosks and counters can process refunds regardless of the company while tax refund booths are exclusive to the company who offered the tax refund. 

Since we didn't bring our Passports with us when we went shopping in Myeongdong, we were not able to avail of the immediate tax refund or the downtown tax refund. We had to wait for the day of our departure from Seoul to process the tax refund in the airport.

Information displays on the tax refund process in Incheon Airport

Here's how we claimed our tax refund:
1. Upon arrival at Incheon International Airport Terminal 1, we first located the check-in counters of Jeju Air to check in for our flights and secure our boarding passes. 
2. After getting our boarding passes, we looked for a seat to fill out and complete the tax refund slips we received from the stores we visited in Myeongdong.
3. Since our total refund was less than KRW75,000 and we packed the shopping items in our carry-on, there was no need for us to go to the Customs Declaration counter. Instead, we proceeded to the tax refund kiosks located behind Counter D. 
4. The staff stationed at the kiosk helped us out by checking our receipts, tax refund slips, and passports. He then scanned our passports and tax refund slips in the kiosk.
5. The documents were handed back to us and we were informed to proceed to Gate 27 at Level 4 to complete the tax refund process.
6. We went through the regular security checking and immigration screening process. 
7. We proceeded to the cash refund desk located at Gate 27 and were asked to present our refund slips and passports. 
8. After checking that we have completed all steps, we were given the tax refund in cash. 

Tax refund kiosks near Counter D are manned by several staff
to assist passengers

Note: When you are packing the tax refund items in your checked-in bags, you will need to inform the ground staff of your airline so they will return your bags after sticking the baggage claim stickers. You will then proceed to the Customs Declaration counter to have the items, receipts, tax refund slips, and passports checked. After your receipts are stamped, you will go to the Oversized Baggage Check-in counter to drop your checked-in bags. You can now go to the tax refund kiosks and follow the next steps in claiming your tax refund.

Was the tax refund process worth it? Definitely a yes! We had money back that we used to buy our meals in the airport. 

To know more about the tax refund system of South Korea, visit the Korea Tourism Organization's website here.

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