Post-Brexit VAT charges (at 21%) and customs duty on top of VRT will likely add thousands to the price of cars being imported from England, Scotland and Wales due to the fact they are now being viewed as a “third country” by the EU.
But what is the situation if you want to import a vehicle from Northern Ireland to the Republic?
We will explore an issue that has been a source of some confusion for some months now on the differences between importing from the British mainland and from Northern Ireland. Before we do so, let’s take a look at some fundamental steps you should consider before you shake hands with the seller, namely, where to look and initial cost issues you need to be aware of.
Please note: The content used in this article is for informational purposes only and does not constitute legal or commercial advice. We would strongly advise that you consult the links to official sources where mentioned and are satisfied with the research you have taken independently:
NI car sales – where to look?
There are a number of options if you are looking to buy a car from Northern Ireland and very often this can work out cheaper in terms of collecting the vehicle and bringing it across the border.
There are several reputable car dealers in Northern Ireland for both new and used cars. A quick online search will provide you with the information you need. usedcarsni.com is a popular option for buyers and the site also lists popular dealers such as Charles Hurst Group and Desmond Motors which is a main Ford dealer based in Derry. If you are seeking a high-end model check out Bavarian BMW in Belfast which also supplies a range of used cars.
Costs to consider
Importing a car from Northern Ireland has some distinct advantages in terms of cost versus importing from elsewhere in the UK.
Firstly, you save on the flight or ferry costs which are necessary when importing to the Republic from mainland Britain. The process from the UK also sometimes involves transportation costs with a third party to get the vehicle home.
Depending on how far from the border you are, you could more than likely make it there and back in a few hours, avoiding the need to book accommodation which is so often necessary when importing from the UK.
Buying Sterling to pay for your purchase
After the Brexit Referendum of 2016, the value of Sterling fell to unprecedented rates against the Euro and other major currencies. The weak pound offered buyers from Ireland a cheaper way to purchase a high spec vehicle from a market where supply was plentiful.
Forward to February 2021 and the value of Sterling has risen against both the euro and the dollar. This means that you receive less from your euro when buying sterling to pay for a car in Northern Ireland. Considering the other expenses you may have to pay, you need to be sure you get the best FX rate to reduce the cost of your purchase.
Many buyers, unaware of the offerings of payment service providers like Fexco, use their bank to convert euro to sterling in advance of their vehicle purchase. However, high street banks charge up to 5% on their foreign exchange services with additional fees that could end up costing you more than you had anticipated.
It is not recommended to carry large sums of money in person. Fexco will exchange your euros to sterling at bank beating exchange rates and transfer the funds to the dealer’s bank account in Northern Ireland. Payments can also be delivered on the same day.
As thousands of buyers have used the Fexco service to pay for their vehicles, dealers in the North are familiar with this method of payment and in fact, many recommend bank transfers as a preferred method of payment.
Complete a car inspection/history check
You like the look of your dream car and the price even more so, but before you make the purchase you need to be aware that a vehicle could end up costing you more than just the selling price in the long term. Some advisory steps to ensure you are accounting for any potential additional costs include:
A Northern Ireland Pre-Purchase Inspection costs from just £80 and will ensure peace of mind with the added bonus of being able to negotiate on price.
Check out WhoCanFixMyCar.com for a list of approximately 80 garages in Northern Ireland that provide pre-purchase car inspection services.
It’s very important as a buyer that you perform a full check on any vehicle to be imported into Ireland from the Northern Ireland before you buy. Important checks such as mileage, stolen, write-off, finance and more are an important part of the pre-purchase strategy.
MotorCheck will find all of a vehicle’s previous registration numbers and include any hidden history that you might otherwise have overlooked.
Do I pay VAT, Import Duty and VRT when importing a car from Northern Ireland to the Republic?
There is a lot of confusion about import duties and VAT on the importation of a used car from the UK and the difference in rules between Northern Ireland and Great Britain.
Those importing directly from the UK will have to make a customs declaration; pay or account for customs duty of 10% if applicable; and pay Vat at 21% prior to presenting the vehicle for registration. VRT is also payable on such vehicles.
As the protocol on Ireland and the North ensures there will be no hard border on the island of Ireland, the rules differ. If a car to be imported into Ireland is first registered in Northern Ireland after January 1 2021, then it can be done without any checks on its customs status. In other words, current rules remain unchanged.
VRT is still payable on such vehicles. VAT is payable on new vehicles (under 6 months old) or those with less than 6,000 km.
When buying a new vehicle from Northern Ireland it is important to note that Irish VAT will need to be paid at the time of registration in the Republic. This could be in addition to UK VAT already paid in the North. A refund of the VAT paid in the North can be claimed from the dealer on production of a receipt of VAT paid in the Republic.
Can I buy a car in the UK and transit through Northern Ireland to circumvent the rules?
The short answer is no. A comment from a Revenue spokesperson in an Irish Examiner article ruled out this possibility:
“Proof that vehicles were properly imported into the North will be required for vehicles first registered in Britain. If this proof cannot be provided, the individual or business importing the vehicle into the State must make a customs declaration, pay customs duty, and pay VAT based on the import value of the vehicle immediately prior to registration.”
Check out VRT.ie which explains the process in more detail and also outlines the situations when VAT is payable:
“Vehicles first registered in the UK and then registered in Northern after January 1st 2021 are not subject to customs duty or VAT, provided there is proof the vehicle was properly imported to Northern Ireland. The proof required is a copy of the customs declaration showing the importation of the vehicle into Northern Ireland or a T2L document issued by HMRC.”
Other costs to consider
Registration & VRT
You have to register your vehicle in Ireland within 30 days. You have to pay Vehicle Registration Tax unless the vehicle is exempt.
You register the vehicle at a National Car Test (NCT) centre. You have to book an appointment online or by phoning 01413 5975.
Check out this handy VRT calculator which calculates the VRT you will need to pay when importing a car to Ireland (including NOx levy).
Get your plates & pay motor tax
Once you have registered the car, you can purchase your registration plates and then pay your motor tax.
Fexco provides bank-beating FX rates and lower fees when importing vehicles from Northern Ireland. Talk to our team on 1800 246 800 to see how you can make significant savings on your import.
If you are buying a car in the UK, please visit out our 9-step guide to Importing a car from the UK to Ireland.