VRT & Transfer of residence question.

eam07

Hi

I have read quit a bit on this board (and there's plenty of good information) about moving to Ireland and buying a car. I have a specific question though that I hope someone can help me with.

I will be moving to Ireland from the UK next month to take up a job. I have been living in the UK for more than 10 years. I have no car but will need one in Ireland. What is the most cost effective way of buying/owning a small car in this situation? I'm not looking to evade tax just avoid it.

Here's some background information: my father who lives in the UK has a car (which has owned for a couple of years and which I am insured to drive) and he is willing to do what it takes to help me out, give it to me.... I have been thinking about buying a small car myself (up to £6000) but the VRT would hit pretty hard if I were to do that as I won't have owned it for more that 6 months before moving. I notice that there is a post at the bottom of the first page "Importing from the UK - Definitive Guide" that states "If you have been living in the UK for the last 10 years you should not have to pay the VRT when you are registering it in Ireland but ...you will have to wait 12 months before you can sell it." Does that means I can buy a car and own it less than 6 months and by virtue of the fact I have been living in the UK for >10 years avoid VRT - I'm guessing not here?

Is it possible to buy a new car and avoid VRT because I am transferring my residence?

Maybe it's possible I can get a letter from my upcoming employer to help this?

Any ideas would be gratefully received.
thanks
eam

whippet

as far as I know you personally need to own the car outside of ireland for at least 6 months. In this period you will need to have taxed, insured the car in your name and be in a position to prove this.

What you are suggesting is buying a car just before moving to ireland in order to avoid paying VRT, by the letter of the law this is not possible.

Tipsy Mac

So if someone owns a car for 6 months outside Ireland they can take it in for free, I thought VRT was a tax on the registration plate, I am so confused, seems that us Irish are living in an apartheid EU where anything goes once government decides.

whippet

Tipsy Mac wrote:

So if someone owns a car for 6 months outside Ireland they can take it in for free, I thought VRT was a tax on the registration plate, I am so confused, seems that us Irish are living in an apartheid EU where anything goes once government decides.

it is a tax on the registration but certain vehicles are exempt including those that which are owned by people outside the state fulfilling certain criteria.

This thread isn't for debating the fairness and equality of this tax (there has been plenty of other threads for that) .. the OP just wants to know where he stands in relation to the law.

Anan1

I'm afraid you've left it too late. The rule requiring you to have owned the car for 6 months prior to importation is, like all the other rules, strictly enforced by the VRO. The only thing you could do is to delay your move until you have owned a car in the UK for 6 months. Sorry to sound so negative, but I was in a similar situation myself when returning from Germany with a car and found out the hard way.

Traumadoc

I returned from Australia last year

I brought 2 cars in one (ml 270cdi) I owned for 7 months- no tax to pay ( saved 20-30K)

the other (911) I owned for 5 months,had to pay VAT and duty and VRT.

eam07

Thanks for the replies.
Is there anyway that my father can help, say I drive his car in Ireland as my name is already on it and as compensation buy him a replacement in the UK?

eam07

I didn't get the job offer 'till recently. Plus I don't need a car in the UK. So there was no way I could beat the 6 mths.

Anan1

eam07 wrote:

Thanks for the replies.
Is there anyway that my father can help, say I drive his car in Ireland as my name is already on it and as compensation buy him a replacement in the UK?

Unfortunately the car has to have been owned by you for 6 months prior to importation. The rules are specifically designed to frustrate attempts to import cars for personal gain.

whippet

unfortunatly your father owns the car so you can't import is as yours, unless you transfer over ownership and wait the 6 months.

eam07

thanks
looks like nothing I can do but bite the bullet and pay the damn VRT. Will have to calculate whether it's cheaper to buy a small car in Ireland than the UK+VRT?

Seth Brundle

How long will you be moving to Ireland for? You can keep your car unregistered for up to a year if you notify the VRO. Any longer than a year and you must pay VRT.

Im not sure what the situation is if you keep it here for just less than a year, 'move' back to the Uk and then return here a week later. I presume the VRO have thought of that.

peasant

kbannon wrote:

How long will you be moving to Ireland for? You can keep your car unregistered for up to a year if you notify the VRO. Any longer than a year and you must pay VRT.

Technically that is not quite correct.

As soon as you transfer your residence to Ireland, you are liable to pay VRT the day after your arrival unless you are VRT exempt.

There are exemtions of up to 12 months for people who are here only temporarily and can prove that (with a limited employment contract for example) or for students, visitors and tourists.

And then there is the grey area of people who at the time of arrival don't know yet how long they are going to stay.

Seth Brundle

Thats what I meant to say. Thanks

Mc-BigE

if I was you I would transfer ownership from your fathers car to your name before moving to Ireland insure, tax mot the car in the UK ,keep paying rent, elect bills etc in the UK for 6 months or better still "move back into parents house"

Drive in Ireland as a "visitor" for 6 months which is quiet legal, 6 six months time or any time after that, get the ferry home to the UK to see family friends etc. and then "move" to Ireland.

added: the only downside to this is all the travelling and trying to prove you are paying rent, got a job, drawing the dole etc in the UK while your over here. Which i'm sure the VRO would go through in detail, and after all that you could end up paying VRT if a crack appeared in the paperwork.

It would have to be an expensive car and resalable car in 12 months time in Ireland to go to this trouble, a 6K stg car in Uk is (depending on the car ) worth maybe 12 to 14K euro over here and after one year depreciation will be worth 9 to 10K to try to sell privately.

I suppose bottom line here is it might not be worth it for a 9-10K Euro car in 2008

eam07

Thanks. The job is for the forseeable future.

As I am genuinely buying a car and moving over to earn a crust and not profit on importing a car, the VRT seems mighty unfair in presuming guilt and not giving you the chance to prove innocence.

peasant

Absolutely correct ...it is unfair. Furthermore it is against the spirit of EU regulations regarding the free movement of goods.

Take it to the EU courts ...you might have a case

eam07

I might just do that.

eam07

According to the key post on importing cars from the UK to Ireland a sound estimate of the expected VRT is ~40% of the cost of the car.

As I am looking to buy a small car ( such as Renault Clio, Vauxhall Corsa) for between £2000 to £5000 is it worth me buying in Ireland instead?

tippbhoy

eam07 wrote:

According to the key post on importing cars from the UK to Ireland a sound estimate of the expected VRT is ~40% of the cost of the car.

As I am looking to buy a small car ( such as Renault Clio, Vauxhall Corsa) for between £2000 to £5000 is it worth me buying in Ireland instead?

VRT is 25% of the market value of the car. To be honest by the time you go over to england, bring back the car, pay VRT etc it's hardly worth it on the smaller purchases IMO. There's a big difference between 2K and 5K btw, the more expensive the car, the better chance you have saving money i.e 300 or 400 to bring the car back after flights, ferry, risk of not taking the car and flying back etc. becomes a lower percentage the more valuable the car. Those costs are fixed regardless of the value of the car so you are wasting your time with a 2 or 3 k purchase.

That being said, i have just done it on a £6K deal and i think i saved a grand or so minimum.

eam07

I'm in the UK at the moment. 25% is a whopping percentage. Cars are therefore much cheaper in the UK?

Mc-BigE

eam07 wrote:

I'm in the UK at the moment. 25% is a whopping percentage. Cars are therefore much cheaper in the UK?

I've been looking into buying my next car over in the UK compared to buying one here, take this example, a 2005 BMW 320d SE (new model) there selling for anything from £16K-17K on ebay.uk, up to 22-23K from a dealer.

say i win the car on ebay at 17K thats 25K euro + about 10K vrt that 35K plus say 1000euro for flights, ferry, hotel, diesel.

thats 36K, now if you look at www.carzone.ie you'll find some of these cars at around that price, so whats the point in going to the trouble of buying in the UK when you can get cars here in a currently very unstable second hand car market.

so if i go to the dealer and buy the £23K version ,i'll definately will find one cheaper here, with no trade in.

eam07

Thanks.
I thought the VRT and expenses would not make it worthwhile.

Mc-BigE

eam07 wrote:

Thanks.
I thought the VRT and expenses would not make it worthwhile.

but the point i'm trying to make is if you didn't have to pay the VRT (only if your moving to ireland from the Uk to Live) on the above example you would save 10K vrt, less 12months deprication in the Irish s/h car market. But i wouldn't have that saving.

Mickk

tippbhoy wrote:

VRT is 25% of the market value of the car.

Dont forget its 25% of the irish value of the car so it is about 40% (usually more on a cheaper car as the fixed costs stay the same) the cost of the car in the uk.

Seth Brundle

VRT isn't 25% for cars under 1.4 or over 1.9 where it is 22% and 30% respectively!

galwaytt

Mc-BigE wrote:

I've been looking into buying my next car over in the UK compared to buying one here, take this example, a 2005 BMW 320d SE (new model) there selling for anything from £16K-17K on ebay.uk, up to 22-23K from a dealer.

say i win the car on ebay at 17K thats 25K euro + about 10K vrt that 35K plus say 1000euro for flights, ferry, hotel, diesel.

thats 36K, now if you look at www.carzone.ie you'll find some of these cars at around that price, so whats the point in going to the trouble of buying in the UK when you can get cars here in a currently very unstable second hand car market.

so if i go to the dealer and buy the £23K version ,i'll definately will find one cheaper here, with no trade in.

I think you'll find the VRT is even higher than 10k on that. A Jan 05 one, 12k miles, would cost Eur11630 in VRT.............