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Do I pay UK VAT when importing a car?

If I am buying a car in the UK to bring to Ireland (taking it through VRT on entry) do I still have to pay the UK VAT on the price of the car?

Molly Green (Co Louth)

Feb 2016 Filed under: importing

Expert answer

Hi Molly,

Effectively, yes. If you're buying it brand new, then you can, theoretically, export it from the UK and claim back the VAT, but you really need an accountant, not a motoring journalist, to walk you through that process. Of course, you'll have to pay Irish VAT on it then. You'll have to pay VAT twice, essentially, if you're buying nearly new - a car under six months old is liable to Irish VAT upon entry into the state, and of course you'll already have essentially paid the UK VAT in the purchase price. You could claim it back of course, but again that's a job for an accountant.


Worth importing a van for private use?

Hi,

I'm looking at importing a Volkswagen T5 or 2006-2007 SWB Kombi, 2.0 TDI diesel, windows and seats in the back with no bulkhead. First thing is, can I tax and insure it privately? Secondly, could I buy a commercial van in Ireland, remove the bulkhead, add rear windows and seats and tax and insure privately for roughly same price as import?

Thanks in advance for your experience.

Brian

Brian Mulroy (Drogheda)

Jan 2016 Filed under: commercial vehicle

Expert answer

Hi Brian,

Yes, you can tax and insure it privately, and indeed you should do because if it were taxed as a commercial, you'd be caught rotten if you were stopped with the kids in the back and it's a €4,000 fine. However, you can legally have it assessed for VRT as a commercial so that's a saving. The odd thing is that taxing it as a private car means, under the current rules, you'll revert to the old pre-2008 tax system, which is based on engine capacity. Odd, but there you go.

As for whether or not an import will be cheaper, it probably depends on how many of the specific style of T5 you want are available on the ground here. All I can suggest is that you do your sums, figure out how much the import will cost, and then have a shop around Irish dealers and ask them if they can match the numbers.


Hybrid and electric cars are not the future...

This is not really a question, just a comment. I just don't understand all this hype about electric and hybrid cars. I live in an apartment, probably way more than half the world lives in apartments or cities where recharging is not feasible. It doesn't look like the future to me.

Cheers

Philip Donegan (Ballina)

Jan 2016 Filed under: hybrid

Expert answer

Hi Philip,

A very, very good point. However, I disagree with you on your broader 'hype about electric cars' comment - the only way we're going to be able to keep motoring, to keep some sort of private, personal transport going, is with electric cars. Now, whether that's with just batteries, or whether that's with hydrogen power or something else that hasn't yet been thought of, I don't know. But the days of digging up Jurassic forests in liquid form and burning them in engines is coming to a rapid close - it's not just about CO2 and global climate change anymore either; the Volkswagen scandal has shown that we've been slowly and insidiously poisoning ourselves with other gases from car engines too. Some 1,200 people in Ireland this year will die from respiratory illness brought on by pollution, a major multiple of those who will be killed in road accidents.

Your apartment point is well made though, and shows just what a period of transition we are currently in. A huge investment is needed to create an environment where electric vehicles can work simply and sensibly, and for all the efforts put in recently to install charging points and fast chargers, it's not nearly enough. Governments and energy companies, and the car makers too, will all have a major role to play in this, but it's just that no-one's playing enough of a role just yet.


Do I tell people about my in-car camera?

Do you have to advertise an in-car camera recording inside the vehicle?

Francis Keogh (Bray)

Jan 2016 Filed under: miscellaneous

Expert answer

Hi Francis,

If it's a private vehicle then, technically, no - it's your car and you can do what you want with it, but it might be at least morally correct to let anyone who's being recorded know what's going on. And if you intend using the videos for any kind of commercial project then, yes, you must get written clearance from people before you're allowed to use their image in the public domain for profit. 

If it's a company car or a taxi then it may in part depend on the terms and conditions of your employment and it would be a good idea to seek legal advice first.


Which new exec diesel auto saloon to go for?

What compact exec would you choose in a diesel auto as a private buyer? BMW 320d M Sport, Audi A4 S tronic, Jaguar XE Portfolio or Mercedes-Benz C-Class? Or would you go with something cheaper like a Volkswagen Passat Highline DSG 190?

Andrew Kelly (Limerick)

Jan 2016 Filed under: choosing new car

Expert answer

Hi Andrew,

Well, of the posh-badge brigade, my personal favourite is the Mercedes-Benz C-Class - it's supremely comfy, beautifully made and really satisfying to drive, but, to be honest, you couldn't go wrong with any of those cars, it really is down to personal taste.

Your other question is an interesting one though. If you can live without the posh badge, and aren't quite so worried about driving dynamics, then a Skoda Superb is pretty much unbeatable. Same mechanical make up as the Audi but far bigger and way better value. Try a Ford Mondeo or Mazda6 if you want something with a keen chassis or a Toyota Avensis if you never, ever want it to break.

Some relevant reviews for you:

Updated BMW 320d review

New Audi A4 2.0 TDI review

Jaguar XE review

Mercedes-Benz C-Class review

Volkswagen Passat Highline review

Skoda Superb review

Ford Mondeo review

Toyota Avensis review


Can a sole trader claim back lease payments?

Hi

I need to buy a new or second hand car. I'm thinking of going the leasing route because I have been told that I can put it through our business, which is a sole trader business, as an expense and we can claim it all back against our income. Also, I'm told that, as we are sole traders, we are exempt from benefit in kind. It sounds to good to be true!

Look forward to your advice

Shane Cox (Moycullen Galway)

Dec 2015 Filed under: finance

Expert answer

Hi Shane,

We enlisted the expert assistance of Conlan Crotty Murray & Co (Leopardstown, Dublin 18, 01 295 9090, www.conlancrottymurray.com) to answer this one for you. Here's the response:

"Generally speaking, leasing companies will only lease new cars.  On the basis that the individual decides to lease a new car then the rental payments under the lease agreement should be treated as an expense in the accounts of the self-employed individual.  As the lease period is usually three or four years this provides for a significantly accelerated write-off of cost for tax purposes as compared with the purchase of an owned vehicle where the tax write-off under the capital allowance regime is spread over eight years.  However, at the end of the lease period if the vehicle is traded in against a new vehicle the trade in allowance on the first leased car may trigger a claw-back of lease charges previously deducted for tax purposes. 

To the extent that the individual uses the car for private use in addition to business use then an appropriate restriction on the tax deductibility of the leasing charges should be applied. E.g. if the car is used 40 per cent for private use, then 40 per cent of the lease payments should be disallowed as an expense in computing income for tax purposes.  The benefit-in-kind provisions referred to by the reader do not apply to self-employed individuals.  The benefit-in-kind rules would apply to the extent that a leased car is provided by an employer to an employee in computing the employee's payroll tax liability.  There is no private use restriction on the tax deductibility of leasing expenses for a car where the car is supplied to an employee and that employee uses the car for private purposes.

Some of the annual lease rental expense may be clawed back in the computation of income for tax purposes if the car has a retail value at inception of the lease of more than €24,000 and the CO2 emissions from the car do not exceed 155g/km.  If the car has CO2 emissions of more than 155g/km, but not exceeding 190g/km, the value of the expense deduction for income tax purposes is restricted by reference to a reduced capital limit of €12,000.  Where the CO2 emissions on a car exceed 190g/km, no deduction for leasing costs is permitted in calculating the individual's income tax liability for the year.

Therefore, for new leased cars costing no more than €24,000 with CO2 emissions not exceeding 155g/km the lease payments may be written-off against income tax over the course of the lease period.  

We recommend that professional advice be sought before entering into any lease arrangement."

I hope that clears it all up for you Shane.


What's VAT situation on importing from UK?

I am considering buying a VAT qualifying car with a VAT number in the UK that is more than six months old and more than 6,000km on the clock. What are the immediate or later VAT implications for me?

Michael O Neill (Limerick)

Dec 2015 Filed under: importing

Expert answer

Hi Michael,

None. If you’re importing a car from the UK that is older than six months old, the VAT is considered as paid and you only need to deal with the VRT charge.


Am I mad to go for Land Rover commercial?

Hi there,

I am a rural vet driving a SWB commercial Toyota Landcruiser. I need to change to a 4x4 with more seating for the kids. I'm thinking of a Land Rover Discovery utility commercial. I'm wondering am I mad to make this move as the stories over the years about Land Rover reliability are plentiful.

Ed

Ed Myers (Cork)

Nov 2015 Filed under: commercial vehicle

Expert answer

Hi Ed,

Land Rover's quality has been getting better and better and it seems as if the current Discovery model has shaken off a lot of its reputation for weak gearboxes and electrical maladies. I think it's probably worth the punt, but there are two other good options - both the Mitsubishi Pajero and Toyota Land Cruiser are also available in 'business versions' that mean you can buy them for the price of a commercial but you get the back seats and luxury touches. That said, you'll have to tax them as a private car if you're going to carry the kids around - it's a €4,000 fine if you're caught with the incorrect tax.


How can I buy a Volkswagen Golf R Estate?

I have my heart set on a Volkswagen Golf R 'Sportwagen' (estate), but it seems Volkswagen Ireland will not be selling them here. Do I have any real options to buy one, given that importing from the UK is prohibitively expensive considering the exchange rate?

Thanks.

Graham McGarry (Greystones)

Nov 2015 Filed under: choosing new car

Expert answer

Hi Graham,

I'm afraid not - it's simply not a model appearing on the official Volkswagen Ireland price list. You could try sweet-talking a Volkswagen dealer but they'll essentially just have to privately import it themselves so they'll just pass on the same costs to you.

We double checked the situation with Volkswagen Ireland and it confirmed the same.

Such a shame!


Can I get Apple CarPlay on my 2015 Golf?

Will Apple CarPlay work on a 2015 Golf with Discover satnav by a software upgrade or would it have to be a hardware fix? I have the media-in cable already.

Simon MacMahon (Navan)

Nov 2015 Filed under: satellite navigation

Expert answer

Hi Simon,

If you go to the settings menu and see a menu heading titled ‘App Connect’ then yes, Apple CarPlay will work, but you might need to go to your Volkswagen dealer to get an activation code.