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Vat Off!!!

smcgiff

Was thinking of buying my next car in the UK. They have higher spec, 3 year warranty as opposed to 2 in Ireland, and the car is still cheaper even after you add in the *spit* VRT.

However I read the first few pages of Robertr’s guide to importing from abroad and it mentioned you have to pay VAT as well as VRT on a new car! :eek:

How does this work? If, say, I pay £30k (17.5 UK VAT inclusive) and €20k VRT what figure do I pay 21% Irish VAT on? If it’s on the VAT inclusive £30k then that blows the whole buying new from abroad out of the water. :mad:

This is completely anti-competitive, and frankly gangsterism - with the government acting as the godfather – Is it to late for the UK to take us back?* Not only do we end up with less spec, less safe cars, but we don’t get as good a warranty as other countries.

*Joking – but half heartedly!

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Anan1

You will pay either ROI or UK VAT, not both. If the car is to be imported new, you won't pay UK VAT but will pay VAT here.

smcgiff

Anan1 wrote:

You will pay either ROI or UK VAT, not both. If the car is to be imported new, you won't pay UK VAT but will pay VAT here.

That's a big relief Anan1 - Thanks very much for the info!

BTW - is the VAT based on the same figure as the VRT? i.e. pretty much independent of how well loaded the car is?

seamus

The Irish VAT is based on the cost of the vehicle plus the VRT. It's an actual double taxation, because you pay VAT on the VRT.

If you can, buy the vehicle in the UK, and register it there if you have to. Costs €200 IIRC. Then you pay the 17.5% UK VAT. Then bring it home, and you have to pay our VRT, but not our VAT.

So since you're only paying the UK VAT on the cost of the vehicle (and not the VRT), then you won't be paying nearly as much.

Anan1

smcgiff wrote:

That's a big relief Anan1 - Thanks very much for the info!

BTW - is the VAT based on the same figure as the VRT? i.e. pretty much independent of how well loaded the car is?

On a new car, VRT and VAT will be as per Irish prices. Irish dealerships have price lists for cars & options broken down into price, VAT & VRT. To be honest, I think it'd be cheaper to buy new here.

Seth Brundle

Do you not have to pay RoI VAT nowadays?

astraboy

seamus wrote:

The Irish VAT is based on the cost of the vehicle plus the VRT. It's an actual double taxation, because you pay VAT on the VRT.

If you can, buy the vehicle in the UK, and register it there if you have to. Costs €200 IIRC. Then you pay the 17.5% UK VAT. Then bring it home, and you have to pay our VRT, but not our VAT.

So since you're only paying the UK VAT on the cost of the vehicle (and not the VRT), then you won't be paying nearly as much.

I think you pay the VAT here first, then the VRT is based on the "Open market selling price" or the price with vat added.

In the EU you only pay VAT once, so if you pay it in the UK you won't repay here. You will of course have to pay the VRT based on the price of the car the customs office come up with. Don't even get me started on VRT.....:mad:

smcgiff

Thanks guys - I'll stick a query in with the Revenue to see what they say and report back if/when I get a response.

Hotblack Desiato

smcgiff wrote:

This is completely anti-competitive, and frankly gangsterism - with the government acting as the godfather – Is it to late for the UK to take us back?* Not only do we end up with less spec, less safe cars, but we don’t get as good a warranty as other countries.

Sure the cars cost more, but the fuel to go in them costs a lot less here. Swings and roundabouts.

Hotblack Desiato

seamus wrote:

Then you pay the 17.5% UK VAT. Then bring it home, and you have to pay our VRT, but not our VAT.

AFAIK you're liable for the difference in VAT rates between UK and here (and the VAT on the VRT of course). In other words they charge you the full whack of Irish VAT but will credit any UK VAT already paid against that.

JHMEG

There is a page on the revenue website somewhere (you'll need to search) that states that if the car is less than 6 months old you have to pay VRT and VAT, which is in addition to UK VAT.

It's on this page, just can't find the one on the revenue site at the moment:
http://www.safehomeireland.com/moreinfo.htm

peasant

some misinformation here guys ...

Basically Irish officialdom doesn't care where in the EU and how much VAT you paid.

If the car is new, ie. under 6 months/under 6000 km you pay Irish VAT at the full Irish rate.

It is then up to you to try and get back your VAT that you paid previously.
You will get no help in this from the VRT/revenue people and you will certainly not get any credit for the vat you already paid.

So ..the advice is, if you absolutely have to buy new elsewhere, buy "export" and VAT free in the first place ...otherwise you'll be seriously out of pocket for a while and face massive hassle in trying to claim your "foreign" VAT back.

And yes ...it's absolutely scandalous !!

JHMEG

Peasant, I pretty much said all that in my above post.

How do you buy "export" and VAT free in the first place, unless you are a business and therefore VAT-registered?

Seth Brundle

JHMEG wrote:

There is a page on the revenue website somewhere (you'll need to search) that states that if the car is less than 6 months old you have to pay VRT and VAT, which is in addition to UK VAT.

It's on this page, just can't find the one on the revenue site at the moment:
http://www.safehomeireland.com/moreinfo.htm

Im quite sure that VAT is not paid twice - only the IRish VAT is paid. Whether that means that the UK VAT is refunded or whatever, I don't know and couldn't be bothered struggling through the revenue site.

smcgiff

ninja900 wrote:

Sure the cars cost more, but the fuel to go in them costs a lot less here. Swings and roundabouts.

Ninja900 - Not sure what you use petrol for, but I only use it for powering my car. The VRT I will be paying on my next car will be approx €25k (everyone in the Republic pays this to a varying degree) i.e. €25k more expensive for a lesser car than what you'd get in the UK.

Petrol in the UK is approx 25c more expensive than here. So, by my rough calculations, I'd have to be using 100,000 litres of 95 octane unleaded in approx 4 years to break even.

smcgiff

Guys,

Forgot to mention - I did a bit of digging on this last night and when you buy a new car outside Ireland in the EU you don't pay the VAT. You pay the net of VAT amount in the UK and pay the Irish VAT in Ireland. Because the car is new VAT is applied first of all to the, say, GB price. The GB price is translated to euro first at the (I think Monthly calculated) customs exchange rate. Then you get VRT added on.

So, in effect you are only paying VRT as an extra. Arguably, you are paying less VAT because you're paying on a reduced cost.

So, to my mind this is very much a runner.

Now, where the problem may come in is where you pay UK VAT by mistake and have to reclaim this at a later date. How would this happen? Well the dealer in the UK doesn't really care about you paying VAT and so it may get paid by mistake. Then you have to chase the UK revenue to get it back!

In summary, my understanding of buying a car in the UK is as follows.

1. Pay UK company Net of VAT price (it is up to you to inform garage you are Irish resident)
2. Pay VAT. Irish Customs will translate GB invoice into Euro and apply 21% VAT.
3. Customs will then charge VRT on the VAT inclusive price depending on litre size of car.

quarryman

€25k VRT?

What car are you planning on getting?!

galwaytt

First of all, if you plan to drive the car away from the dealer in the UK, you will have to pay the UK VAT. The only way you can export the car, and not pay VAT in the UK, is if it's exported on a car transporter - not driven.

Drive the car back, pay full Irish VAT, and then start the process of claiming the UK VAT back from HM Revenue as a refund. (you do this by submitting proof of paying it here, instead) This means, for a period, you have to have enough cash to pay BOTH VAT bills.

You will then pay: full Irish VRT (including the extra VRT for all the 'extras' you put on the car; leather/auto/cruise etc, will be ADDED to the IRISH price..), then you 21% VAT on the price you paid +VRT

If the car you're buying still ends up cheaper than buying it here, I'll eat my....lunch.

The whole idea of VRT is to make it deliberately MORE expensive to import a car under the 6k/6 months than to buy it here.

IMHO, unless you're buying a repo, etc, it won't pay you for car that new.

FWIW, I got a quote from the VRO yesterday for an 11 year old 911......15k :eek:

smcgiff

quarryman wrote:

€25k VRT?

What car are you planning on getting?!

Had been thinking of getting a Boxster, but may now get a bells and whistles V6 TT (seems a better car € for €). This is approx 3 years down the line mind! If I'm buying in the UK I'll pretty much need all the money up front, so planning ahead and don't want any surprises.

But even when someone buys a bog standard (no bells or whistles) 2.0l Passat they would still pay €7.6k on VRT when they import it. VRT is really only noticeable when you buy abroad, but everybody pays for it directly or indirectly whether you buy new or old in Ireland – in fact I imagine the VRT on a car bought in Ireland is more because the base cost is higher!

smcgiff

galwaytt wrote:

You will then pay: full Irish VRT (including the extra VRT for all the 'extras' you put on the car; leather/auto/cruise etc, will be ADDED to the IRISH price..), then you 21% VAT on the price you paid +VRT

But you pay VRT on leather/Auto/Cruise control anyway - It's just more obvious when you import. Why would it be less expensive to pay VRT on an Irish bought car?

BTW, not sure about the having to pay VAT to the UK dealer up front. One article I read stated high rollers were buying their cars legitimately without VAT, but erm, some forgot to pay the Irish VAT on their return and promptly had their supercars impounded. :eek:

Anyway, I've emailed Portadown Audi for their take and will let ye know how I get on.

smcgiff

galwaytt wrote:

FWIW, I got a quote from the VRO yesterday for an 11 year old 911......15k :eek:

Just as well, otherwise you'd have to change your name to galway911 and I've just registered it!

Only joking!

Seth Brundle

smcgiff wrote:

Just as well, otherwise you'd have to change your name to galway911 and I've just registered it!

Only joking!

Just as well that you didn't as holding more than one a/c is an instant site ban!

Hotblack Desiato

smcgiff wrote:

Ninja900 - Not sure what you use petrol for, but I only use it for powering my car. The VRT I will be paying on my next car will be approx €25k (everyone in the Republic pays this to a varying degree) i.e. €25k more expensive for a lesser car than what you'd get in the UK.

It's your choice to buy an expensive/large engined car, you know what it costs, you'll have to pay the VRT whether you buy here or import. Really it would be exactly the same if someone started a thread here saying "I'm 17 and want to buy a Skyline but can't afford to insure it, boo hoo." - if you can't afford to insure a high risk car, get a Micra - ditto with VRT, fuel costs, road tax etc. on large engined or high value cars.

Now there may be legitimate grounds for challenging the fairness of the OMSPs on which VRT on imported cars is calculated, but tbh I couldn't care less as motorbike VRT is a straight cc & age related tax

Petrol in the UK is approx 25c more expensive than here. So, by my rough calculations, I'd have to be using 100,000 litres of 95 octane unleaded in approx 4 years to break even.

For someone not buying such an expensive car it would go much futher towards making up the difference. Also, living in the UK you have council tax etc. to pay. A country has to be run and things have to be paid for, we've chosen to use VRT as one of the means of helping to do this and judging by the numbers of new cars being registered and the increase in their average cc, it's not putting buyers off at all. It's a political decision at the end of the day.

I and many other voters wouldn't like to have income tax whacked up so that luxury car buyers can save money.

smcgiff

ninja900 wrote:

I and many other voters wouldn't like to have income tax whacked up so that luxury car buyers can save money.

Jeez, and I normally tip them so well!

smcgiff

Okay, Just off the phone with Portadown Audi.

So, there's some cashflow implications. Because people were "forgetting" to pay Irish VAT. What happens now is that you pay the UK VAT, and then you pay the Irish VAT. You then go back to the UK dealer with proof of VRT and Irish VAT and they will issue a cheque for the UK VAT.

Simple!

Definitely a bit more hassle than I thought, but thems the breaks!

But, it would end up cheaper in the end and you'd get an extra year's warranty. I'll still keep it in mind.

Thumper Long

Hypothetically speaking could you buy a car in the UK vat free, then wait 6 months before bringing it to ireland and not pay vat at all or would you also have to have 6001kms on it aswell.

peasant

You would indeed because them's not stoopid them VRT people

galwaytt

Thumper Long wrote:

Hypothetically speaking could you buy a car in the UK vat free, then wait 6 months before bringing it to ireland and not pay vat at all or would you also have to have 6001kms on it aswell.

funnily enough, they have thought of that.........which is why you'll have to bring proof of UK residency - electricity bill/payslips/rent, etc..........

galwaytt

smcgiff wrote:

Had been thinking of getting a Boxster, but may now get a bells and whistles V6 TT (seems a better car € for €). This is approx 3 years down the line mind! If I'm buying in the UK I'll pretty much need all the money up front, so planning ahead and don't want any surprises.

But even when someone buys a bog standard (no bells or whistles) 2.0l Passat they would still pay €7.6k on VRT when they import it. VRT is really only noticeable when you buy abroad, but everybody pays for it directly or indirectly whether you buy new or old in Ireland – in fact I imagine the VRT on a car bought in Ireland is more because the base cost is higher!

the base cost in Ireland is actually lower..........

on a tangent, I'm off to the UK on Wed, bringing back a TT on Fri. It's a remapped 225, now at 260. You'd have to be mad to bring a TT 3.2 - you'll never shift it due to tax/insurance when you're finished with it. The 1.8 is fairly reasonable, and is eminently tunable............

lots of nice ones on www.pistonheads.co.uk

Oh,

Seth Brundle

Thumper Long wrote:

Hypothetically speaking could you buy a car in the UK vat free, then wait 6 months before bringing it to ireland and not pay vat at all or would you also have to have 6001kms on it aswell.

My wife from Belfast still had to pay VRT on a 4 year old 106 some years back as the VRO person wasn't fully satisfied that Belfast was her permanent address.
Its not easy getting something past the VRO!

1not24get

I phoned the VRT office regarding importing a new car (less than 6 months old and less than 6000km on it) from the UK...the way they calculate the final price is:
Irish VAT on the final UK price you paid (whether it included UK VAT or not)
+
VRT (a separate figure worked out between the ISMI and revenue (OMSP)for the model in question regardless of what was paid for it...VRT has to be paid even if you got the car for free....like a prize or somethin!!!!!!!)

First question:
Has any Irish resident ever bought a new car in the UK, paid full UK price including VAT, brought it straight back to Ireland.... paid Irish VAT and VRT and then successfully claimed the UK VAT back from the UK revenue?

Second question:

Say I, an Irish resident, buy a new car in the UK...pay the full UK VAT inclusive price...register it in my name with a UK address...park it in long term storage.....then after six months take it from UK to Europe...go on holiday around Europe with it.....put up 6000km on it......return to Ireland present myself with the car at a VRO....what would happen?

Could I just pay the VRT and drive away? Would this be legal?

You're thinking sounds like a lot of trouble but I reckon I'd save €10,000 on top of the range VW sharan tdi!!

Does anyone know of a 'VRT' accountant who i could ask? just get the feeling if I asked the VRO, they would just say NO to get rid of me!