Can we redeem VATpaid for Lodging?

Matt's correct. I lifted this from the UK revenue & customs website: >>Goods you can claim refunds for: You can obtain VAT refunds for anything on which you pay VAT in the UK apart from the following: •new or used cars •a boat you plan to sail outside the EU •goods worth more than £600 exported for business purposes •goods to be exported as freight •goods that need an export licence - except antiques •unmounted gemstones •bullion over 125g, 2.75 troy ounces or ten Tolas •mail order goods, including Internet sales
•goods used or partly used in the EU, such as perfume •service charges, such as hotel expenses<<

No, you can't. Also, you can't get back VAT for small purchases under £30.00. When you make a purchase you will have to ask the clerk if they take part in the VAT Scheme...not all shops do, if they do they will fill out a form for you. When you get to the airport to leave you will need to go to the Travelex counter and turn your VAT forms in and they may ask to see the items that you purchased. Edit...I just noticed that the above post said that you can get a refund of your VAT on anything (but a few things as listed) but remember you have to spend more then £30 on the purchase (it's not £30 added up for ex., not £10 here, £5 here, £15 here).

I'm fairly certain you can only be compensated for VAT on products taken out of the country, not on goods and services consumed on site.