VAT on uk imported cars

lauma

Apologies if that was asked before . Basically my husband wants to buy a commercial vehicle for his business in UK. he found one and Dealer insists that he needs to pay VAT and then claim it back in Ireland. (husband is VAT registered self-employed) We thought that it will be only enough to produce them his VAT number. Are we wrong there? I do understand that we will need to pay VRT in Ireland but wat's the story with VAT? Thank you

lifer_sean

UK dealer is wrong, in that you can't claim back UK VAT from Irish authorities. You might be able to claim VAT from UK authorities after you have the van in Ireland. However, the usual approach is that the dealer would zero rate the VAT for you once you produce evidence of being VAT registered in Ireland. Some dealers will charge you the VAT in UK as a refundable deposit, and then refund that VAT after you provide proof of export. Some will charge you for this service, 6% of the VAT amount is common.

Abuse of this system is a common form of VAT fraud, which the authorities on both sides are trying to stamp out.

There is an on-line system (VIES ???) that the dealer can use to independently verify your VAT number. I have got parts from UK, and when I provide my VAT number, the suppliers can tell me my name and address, and will only deliver to that address.

lauma

lifer_sean wrote: »

UK dealer is wrong, in that you can't claim back UK VAT from Irish authorities. You might be able to claim VAT from UK authorities after you have the van in Ireland. However, the usual approach is that the dealer would zero rate the VAT for you once you produce evidence of being VAT registered in Ireland. Some dealers will charge you the VAT in UK as a refundable deposit, and then refund that VAT after you provide proof of export. Some will charge you for this service, 6% of the VAT amount is common.

Abuse of this system is a common form of VAT fraud, which the authorities on both sides are trying to stamp out.

There is an on-line system (VIES ???) that the dealer can use to independently verify your VAT number. I have got parts from UK, and when I provide my VAT number, the suppliers can tell me my name and address, and will only deliver to that address.

Thanks a lot for your reply. Well the dealer can check whatever he wants we have no problem with that. We are looking to buy from UK not because it looks cheaper but because they do have more vehicles to choose from. We are particular interested in Toyota Hilux (automatic) and there are only few in Ireland.
Ok so what should we say to that dealer because he was so confident on the phone and repeated the same via email that we need to pay VAT. Its Toyota approved dealer. Thanks

grogi

lauma wrote: »

Apologies if that was asked before . Basically my husband wants to buy a commercial vehicle for his business in UK. he found one and Dealer insists that he needs to pay VAT and then claim it back in Ireland. (husband is VAT registered self-employed) We thought that it will be only enough to produce them his VAT number. Are we wrong there? I do understand that we will need to pay VRT in Ireland but wat's the story with VAT? Thank you

You have to pay VAT when the vehicle is considered new: not registered or registered within last six months or it has mileage of less than 6000 miles (or km - don't really remember). Otherwise you pay only VRT.

I am not really sure, but you probably won't be able to claim the VAT back, but the whole gross figure would be considered a cost.

grogi

lifer_sean wrote: »

UK dealer is wrong, in that you can't claim back UK VAT from Irish authorities. You might be able to claim VAT from UK authorities after you have the van in Ireland. However, the usual approach is that the dealer would zero rate the VAT for you once you produce evidence of being VAT registered in Ireland. Some dealers will charge you the VAT in UK as a refundable deposit, and then refund that VAT after you provide proof of export. Some will charge you for this service, 6% of the VAT amount is common.

That is pure extortion and illegal according to EU laws. There is a EU directive that clearly states that VAT should not be applied if goods are exported out of the country and will be taxed in the country of destination.

lifer_sean

grogi wrote: »

That is pure extortion and illegal according to EU laws. There is a EU directive that clearly states that VAT should not be applied if goods are exported out of the country and will be taxed in the country of destination.

But you can get the VAT back from UK, you just have to prove you exported it first before you get the VAT refunded.

This is because of the scammers who were claiming VAT on cars in UK for export, but who were sometimes not actually exporting the cars.

grogi

lifer_sean wrote: »

But you can get the VAT back from UK, you just have to prove you exported it first before you get the VAT refunded.

This is because of the scammers who were claiming VAT on cars in UK for export, but who were sometimes not actually exporting the cars.

I was rather referring to the 6% service charge...

lifer_sean

grogi wrote: »

I was rather referring to the 6% service charge...

Yes, it's a drag. Handling charge. Could possibly avoid this 6% by claiming directly from HM Govt but more paperwork. Either way VAT is a pain.