Importing a Car from Europe - Gelp Needed

ianomccabe

Quick question.

A friend just called me who is in Spain and is looking at a brand new car in a showroom over there. What taxes would he be subject to if he was to purchase the said car and bring it back to Ireland?

Would it be purely VRT? or would he need to pay VAT too?

Mc-BigE

Assuming he’s still a resistant in Ireland, not Spain, He is liable for VRT on what the Irish Government think the equivalent car here is worth.
Because the car is newer than 6 months old, it will also be liable for 21% VAT on top of the price he paid in Spain (including any Spanish taxes/VAT!)

Do a search for VRT and VAT in this forum, it’s been discussed before. Also try searching “6000 KM” which is the amount of km's needed on the car before NO vat payment is required.

ianomccabe

cheers thanks for the help

Anan1

Mc-BigE wrote:

Because the car is newer than 6 months old, it will also be liable for 21% VAT on top of the price he paid in Spain (including any Spanish taxes/VAT!).

He can, however, buy a new car VAT-free in Spain if it is for tax-paid export to another EU country.

kluivert

Mc-BigE wrote:

Because the car is newer than 6 months old, it will also be liable for 21% VAT on top of the price he paid in Spain (including any Spanish taxes/VAT!)
.

Thats incorrect, Vat only gets paid once in the EU, therefore he would not have to pay the Vat in Spain but pay it here as you said.

Mc-BigE

kluivert wrote:

Thats incorrect, Vat only gets paid once in the EU, therefore he would not have to pay the Vat in Spain but pay it here as you said.

I just assumed that a spainish dealer would charge vat on a private car sale, i thought that companies are the only people who can buy in the EU vat free?
Anyway, all the better for the OP's friend if he can, but i would check to be sure with spainish dealer before purchase.

Alun

kluivert wrote:

Thats incorrect, Vat only gets paid once in the EU, therefore he would not have to pay the Vat in Spain but pay it here as you said.

But VAT in Spain is 16% , so that wouldn't make much sense. Better to pay it there.

peasant

Very simple really:

No VRT, no VAT:

If your friend is a european citizen, relocating from Spain to Ireland, bringing in a car as his personal property. The car would have had to be his private vehicle and in use in Spain for the previous six months minimum (plus must have at least 6000 km on the clock)

VRT:

The above does not apply and your friend is importing a second hand vehicle into Ireland (older than 6 months, more than 6000 km)

VRT and VAT
Your friend is importing a new-ish vehicle into Ireland (under 6 months old and/or under 6000 km). In this case Vat has to paid as well, which makes it a good idea to buy VAT free in the other country or fill in the necessary forms to get VAT back, once the Irish VAT has been paid.
As VAT is lower in almost any other EU country importing new is a pretty bad deal ...might as well buy here and haggle.

Alun

peasant wrote:

VRT and VAT
Your friend is importing a new-ish vehicle into Ireland (under 6 months old and/or under 6000 km). In this case Vat has to paid as well, which makes it a good idea to buy VAT free in the other country or fill in the necessary forms to get VAT back, once the Irish VAT has been paid.
As VAT is lower in almost any other EU country importing new is a pretty bad deal ...might as well buy here and haggle.

So you're saying that if you import a new(-ish) vehicle into Ireland you have to pay Irish VAT at 21%, even if you've already paid Spanish VAT at 16%? Didn't know that. Is this a special case for cars only, because it doesn't apply to other goods obtained within the EU?

peasant

Yepp ...this another prime example for rip-off Ireland ...the governement itself this time doing the ripping!

Don't know if this applies to anything else or how the f*** they get away with it ...but they do

jenerate

No VRT, no VAT:

If your friend is a european citizen, relocating from Spain to Ireland, bringing in a car as his personal property. The car would have had to be his private vehicle and in use in Spain for the previous six months minimum (plus must have at least 6000 km on the clock)

VRT:

The above does not apply and your friend is importing a second hand vehicle into Ireland (older than 6 months, more than 6000 km)

VRT and VAT
Your friend is importing a new-ish vehicle into Ireland (under 6 months old and/or under 6000 km). In this case Vat has to paid as well, which makes it a good idea to buy VAT free in the other country or fill in the necessary forms to get VAT back, once the Irish VAT has been paid.
As VAT is lower in almost any other EU country importing new is a pretty bad deal ...might as well buy here and haggle.

This is not correct. VRT is payable on all passenger vehicles up to 25 years old. Check www.revenue.ie and look for the VRT calculator. This will show the amount of VRT payable on any second hand car imported into Ireland.


On new cars Ireland is one of the cheapest places in Europe to buy a car. What makes them expensive is the 21% VAT and 30% VRT payable on top. This means that on amy car over 2.0 litres the govenment get over 50%. To make things worse the VRT is calculated on the vat invlusive price.

Any car dealer in the EU can export a car and not charge local taxes. However, you will end up with a LHD car and probaby pay more than you would from an Irish dealer once Irish VAT and VRT are paid.

peasant

jenerate wrote:

This is not correct. VRT is payable on all passenger vehicles up to 25 years old. Check www.revenue.ie and look for the VRT calculator. This will show the amount of VRT payable on any second hand car imported into Ireland.

Which is not correct? that you can import a car VAT/VRT free when relocating?

Yes it is.

Under the following conditions, as stated on the revenue website "Tax relief on transfer of residence, VRT3":

(There is no direct link to this page / form ...hope it is ok to copy and past the whole text)

VEHICLE REGISTRATION TAX


Tax Relief on Transfer of Residence - VRT 3
INTRODUCTION

This leaflet outlines the circumstances in which a person coming from abroad to take up residence in Ireland may obtain relief from tax in respect of a motor vehicle brought from abroad as his/her personal property. Tax means Vehicle Registration Tax (VRT). It also covers import charges (i.e. Customs duty and VAT) in the case of a transfer from outside the European Union.

Please note that both the Canary Islands and Channel Islands are outside the EU for VAT purposes. Motor vehicles imported from these territories are liable to VAT. In order to qualify for relief from VAT you must have had your normal residence outside the EU for a continuous period of at least 12 months prior to transfer. VAT relief is treated separately to VRT relief in the case of non-EU importations. For a full list of EU territories which are excluded from the EU for VAT purposes please see Appendix 1 of this leaflet.

In order to qualify for relief certain requirements must be met in regard to:


residency, both here and abroad
and



the motor vehicle in respect of which relief is claimed.
WHAT ARE THE RESIDENCY REQUIREMENTS?

For VRT purposes you must have had your normal residence as defined below, outside the State at the time of transfer. In the case of a transfer from outside the EU, you must have had your normal residence outside the EU for a continuous period of at least 12 months prior to transfer.

Normal Residence means:



the place where you usually lived, for at least 185 days in the year ending on the date of transfer, because of occupational and personal ties


if you had no occupational ties, the place where you usually lived for at least 185 days in the year ending on the date of transfer, because of personal ties


if your occupational ties were in a different country from your personal ties then the country of your personal ties is taken as your normal residence if you returned there regularly (i.e. for most of your non-working days).
YOU DO NOT QUALIFY FOR RELIEF FROM VRT



if you went to live abroad primarily for the purpose of pursuing a course of studies


if you were working abroad on a task of duration of less than one year and your personal ties remained in the State


if you were working abroad on a task of duration of more than one year and you have been granted tax relief in respect of another vehicle in the previous 5 years.
WHAT ARE THE REQUIREMENTS RELATING TO THE MOTOR VEHICLE?


The following requirements apply to the vehicle:



it must be your personal property


it must have been acquired with all the appropriate local taxes paid and these must not have been exempted, or refunded in any way. (There are certain exceptions in the case of diplomats and members of international organisations recognised by the Department of Foreign Affairs. Details are outlined in a separate leaflet available at any Vehicle Registration Office (VRO). Regional VRO Contact Details.


you must have had possession of and have actually used the vehicle outside the State for at least 6 months before your transfer to Ireland. In the case of relief from import charges, you must have used the vehicle at your former normal place of residence. Any possession and use in the State, even during times when you were living abroad, does not count


you must bring the vehicle into the State within 12 months of the date of your transfer of residence.
IS PROOF OF RESIDENCE REQUIRED?


Yes, you will be required to produce sufficient evidence to show that you have been living abroad for the required length of time. You will also be required to show that you are taking up residence in the State. The evidence required includes documents relating to:



the acquisition and disposal of property abroad and in the State (e.g. rent agreements, mortgage documents, rent/mortgage payments etc.)


employment abroad and in the State (e.g. payslips, tax records, social welfare records etc.)


other transactions carried out in the course of day to day living (bank statements/transaction documents, bills/receipts for electricity, phone, service charges and other day to day living expenses)


travel records connected with trips into and out of the State


other such evidence as requested in individual cases.
Remember the onus is on you to prove that you were resident abroad for the stated period. If the necessary documentary evidence is not furnished, tax relief cannot be granted.

WHAT EVIDENCE IS REQUIRED IN RESPECT OF THE VEHICLE?


You are required to prove that you had possession of and actually used the vehicle abroad for at least 6 months before transfer and that the appropriate local taxes have been paid and not refunded. This proof will usually consist of:



the vehicle registration document
the certificate of insurance



the sales invoice, receipt of purchase or other similar document
evidence of the date on which the vehicle was brought into the State (e.g. sailing ticket)
You may also be requested to produce other evidence (e.g. evidence of maintenance and use of the vehicle).

ARE THERE RESTRICTIONS ON THE SALE OR DISPOSAL OF A VEHICLE WHICH HAS BEEN GRANTED TAX RELIEF?

Yes. You may not sell, dispose of, hire out or lend the vehicle during the 12 months following the date of registration. If you do, the VRT (and Customs duty and VAT if appropriate) must be paid in full.

WHERE AND WHEN DO I APPLY?

If you are transferring residence from within the EU, you must present your application and the vehicle at your local VRO by the end of the next working day following the arrival of the vehicle in the State. If you are coming from outside the EU, you must lodge your application when importing the vehicle at the Customs Office at the point of arrival in the State.

WHAT FORMS MUST I COMPLETE?

You must complete the following forms:



Form C & E 1077 (on transfer from within the EU) or


C&E 1076 (on transfer from outside the EU), and


Form VRT 4 (motor vehicles) or VRT 5 (motor cycles)
These forms are available at all VROs and Customs Stations.

WILL TIME BE ALLOWED TO PRODUCE THE NECESSARY DOCUMENTARY EVIDENCE IN SUPPORT OF MY APPLICATION?

Yes. You will be allowed up to 30 days from the date you lodge your application. In that case you will be issued with an acknowledgment slip (Form VRT 25) which should be carried in the vehicle until registration has been effected.

CAN I APPEAL A REFUSAL OF MY APPLICATION?

Yes. If you have sufficient grounds, you may appeal within two months of the date of the decision. A separate leaflet, VRT 6, sets out the VRT appeals procedure.

WHERE CAN I GET FURTHER INFORMATION?

Further information and application forms are available from your local VRO. Regional VRO Contact Details.

WARNING

It is an offence to make a false declaration for the purpose of claiming relief from duties and taxes or to furnish false documentation in support of such a claim.

NOTE


This leaflet does not purport to be a legal interpretation or a comprehensive statement of the laws and regulations relating to tax relief on Transfer of Residence. These are contained in



the Finance Act 1992 (as amended) and Statutory Instrument No.59 of 1993 for VRT
Statutory Instrument No. 183 of 1985 which gives effect to Council Directive 83/181 (EEC) for VAT
Council Regulation (EEC) 918/83 for Customs duty.
APPENDIX 1

EU Territories which are Excluded from the EU for VAT purposes

Channel Islands, Gibraltar, Andorra, San Marino.
Canary Islands, Ceuta, Melilla (Spain).
Livigno, Campione d’Italia, Italian Waters of Lake Lugano (Italy).
French Overseas departments, i.e. Guadeloupe, Martinique, Reunion, St. Pierre and Miquelon and French Guiana.
Faroe Islands, Greenland (Denmark).
Island of Heligoland and Territory of Busingen (Germany).
Mount Athos (Greece).
That part of Cyprus over which the EU member does not exercise effective control.



June 2004