Importing a Used Car to Ireland from the UK

The low value of Sterling has helped to make importing a car from the UK to Ireland even more affordable than usual in the last year or two. The Pound is still providing quite good value for Irish car buyers. (See latest exchange rate news Here) .

The Covid-19 crisis made personal imports of UK cars more difficult in 2020 because of travel restrictions – and used car imports to Ireland from the UK fell in 2020.

Brexit and Used Car Imports from the UK


Brexit and confusion over VAT and duty on car imports might put people off buying in the UK .
Before Brexit, there could be fairly big financial savings when importing a used car from the UK. Brexit will probably result in increased car prices in Ireland and the UK – both on new and used imports.
See further down for some information about the effects of Brexit on importing cars to Ireland from the UK.


As well as better prices (historically) – the UK has a bigger choice of used cars than here in Ireland. Many cars have better specs and it’s close enough to keep transport costs fairly low. (Especially if you are buying in Northern Ireland)

In  2019 – the number of imported private cars licensed here was 108,895 an increase of 9.5% on 2018 . There were only 113,305 new cars registered  so almost  49% of all new car registrations in Ireland in 2019 were on imported cars.

The prices of cars in Northern Ireland are generally more expensive than those in England /Wales  – but the ease of access and reduced transport costs from Northern Ireland sometimes make it the best option.


Getting the Best Exchange Rate

The savings to be made when buying a car in the UK and bringing it back to Ireland will vary alongside the euro sterling exchange rate. A stronger Euro or weaker Pound will result in even bigger savings. The weakness of Sterling seems to be a significant driver of UK car imports.

Many people just ignore the effect that differences in currency exchange rates, fees and commissions have on the final price of their UK car import.

The easy option might seem to be to let your bank take care of the currency exchange. However, if you do this you are guaranteed to lose a few hundred euro.The Banks don’t all use a “standard”  rate – it will vary depending on the amount involved and they usually add a profit margin of 2% to 5 %. But there are other ways of converting your Euros to Sterling .


Alternatives to your Bank for Currency Transfer


Currency Fair
is an Irish online currency exchange service regulated by the Central Bank of Ireland. You can lodge Euros with a debit card or bank transfer. If you use them, they say you could save as much as £250 on a £10,000 transfer to the UK compared to using one of the main banks.
First Ten transfers for free using this link


Fexco  is based in Ireland, with operations in 29 countries worldwide. They can usually offer car buyers better exchange rates than the main banks.  You can quickly request a quote online on their dedicated page for Irish UK car imports.

fexco

Fexco has been around since 1981 and is regulated by the Central Bank of Ireland, and by the Financial Conduct Authority for the conduct of payment business in the UK.


Read more details about other options for paying for a car in the UK. 



Brexit and Private Used Car Imports From the UK (Not NI)

Importing second hand cars from the UK to Ireland after Brexit will not be as simple or as cheap as it was before.
Prior to Brexit , VAT only had to be paid on privately imported used UK car imports if the imported car was less than 6 months old or had done less than 6000 km. There was no import duty payable.

Since Jan 1st 2021 – if you are an individual or a business and you import a used vehicle from Great Britain you are required to:

  • complete a customs declaration
  • pay possible customs duty of up to 10% (Duty is charged on vehicle price plus shipping).
  • pay VAT at 21% (calculated on total price incl duty and shipping).
    (There is a possibility of not paying UK VAT if you buy off a UK dealer)

Duty On Used Cars Imported to Ireland From the UK

Many people thought that the Brexit trade deal would mean no duty or tariffs at all on goods traded between the UK and the EU.
That’s how it sounded when it was first announced. Everyone was so glad to hear there was a deal – the small print was ignored for a while.
The truth is there can be import duty on some goods sold between the UK and the EU .

All goods sold from the UK to the EU with a country of origin of the UK will have 0% duty.

However, some categories of goods can also be imported into the EU with a zero per cent rate of duty – regardless of the country of origin. Some examples here. (Used cars are not 0% Duty)


Country of Origin


The definition of “country of origin” for import duty purposes is very important and it can get complicated. It doesn’t just refer to the location of the goods. It is based on the country where it was made can involve the materials used to produce the goods.

For example :

  • Goods made in the UK exclusively from materials that were produced in either the UK or the EU are classed as UK Origin.
  • Goods made in the UK containing materials from countries outside the EU and UK need to meet product-specific rules of origin to be classed as UK Origin.
    • for example – a new car made in the UK must have at least 55% UK or EU content to be classed as UK Origin.

How does this affect the Duty on Used Cars Imported From the UK To Ireland ?

Note – – the rules on import duty do not seem to apply in the same way to new cars and used cars. It looks like that once a car is used it loses it’s country of origin status.

According to Revenue – the following types of used vehicles imported from the UK (not NI) will not qualify as UK origin under the rules of origin:

  • Vehicles of EU origin used in the UK
  • Vehicles of other third country origin used in the UK. (Even if the EU has a Trade Agreement with the third country such as Japan/ South Korea)

Customs Duty on Used Cars From the UK Imported to Ireland (Not From NI)

(Figures obtained from Revenue Jan 8th 2020)

Used Vehicle Country of Origin Customs Duty Payable
 UK0%
Any EU Country10%
Any other Country
(Even if they have an EU Trade Deal )
10%

(Do not rely on this information as being correct. Rules could change . Check with Revenue yourself before buying).

Some examples (based on the above)

  • A car produced in a UK factory – with 40% content from Japan would be classed as UK Origin with 0% duty on import as a used car to Ireland.
  • A car made in Germany sold new in the UK and then sold as used to Ireland 2 years later – 10% Duty
  • A Car made in South Korea registered and used in the UK for 3 years and sold to Ireland – 10% duty

Japanese Imports

After Brexit – it might be just as easy and sometimes as cheap to import a car from Japan instead of the UK !

All the cars in Japan have a right-hand steering wheel because they also drive on the left. There is a good market in used cars in Japan and the prices seem cheap. A quick search here found a few 2016 Nissan Leafs with low mileage priced at around 2 million Yen
Don’t panic – at current exchange rates that is about €15,800 Euro .
Add on shipping etc – and it comes to about €17,400 Euro. Add on 7.5% duty of 1300 and 21% VAT and it comes to about €22,600.

Garton Global Payments have experience of dealing with currency exchange from Euro to Yen. If you need to send money to Japan from Ireland they can do it for you. .



Brexit and Car Imports from Northern Ireland

A new unique trading position has been agreed for NI which remains within both the EU and UK territories.

If a used vehicle is being imported from Northern Ireland into the Republic after Jan 2021 : –

  • Import duty will NOT apply
  • 21% Irish VAT will NOT be charged on used cars (it will on new cars)

However – Proof that vehicles were properly imported into Northern Ireland will be required for vehicles first registered in Great Britain and subsequently registered in NI after 1 January 2021.
See – Revenue Guide


VRT

VRT: When importing a car into Ireland  – buyers need to be aware that VRT (Vehicle Registration Tax) also has to be paid  The VRT is calculated on the Revenue’s assessment of the car’s  “open market selling price ”  (OMPS) in Ireland rather than its UK price.  VRT is calculated as a percentage of the OMPS – with lower CO2 emission cars having a lower rate of VRT.
You can get an estimate of the VRT to be paid on an imported car here