Like every country in the EU, we pay VAT on purchases. The rate varies within the union, in Ireland the standard rate is 21 percent. However, when it comes to motor cars the Irish Governement departs from the EU template and imposes an additional tax.
It’s called Vehicle Registration Tax (VRT) and is payable not at the time of purchase, as such a tax would contravene EU regulations, rather it payable on first registration of a car in Ireland.
So while it is possible to buy a car and not pay this tax it could not be driven on a public road or even resold, a sneaky tax indeed, both in existance and implementation.
There are no loopholes or tax avoidance methods. Even if you personally imported a new car from abroad once it arrives here you’ll have to register it, and in doing so pay the VRT. The VRT calculated as a percentage of the cars value. Not necessarily the price you paid but rather on a price supplied by the Revenue Commisioners called the Open Market Selling Price (OSMP). So even if you bought a second-hand Toyota Landcruiser from a abroad, lets say from friend in Japan who sold it to you for a token EUR 1, you’d still have to pay about EUR 2,000+ to the Revenue Commissioners.
You’ll remember I mentioned the VAT on all purchases, and then went onto to VRT, one might have considered these to be mutually exclusive, but actually VAT is applied to the post VRT OSMP, a double tax.
Now lets get back to tax avoidance. If the Revenue Commissioner are happy to dissect EU regulations and dance around the boundaries, then I would be happy to do the same to VRT. After soe research I found out that VRT on “large vans”, “lorries” and “tractors” is a flat EUR 50,
but I can’t imagine driving a fuel thirsty large van, even unladen, would cancel any saving, plus parking would be a nightmare. Fortunately there is another exception for the smaller vehicles “Small vans” “pick-ups” and some “four-wheel-drives” these are charged at “resonable” 13.3 percent of the OMSP. So I could import that Landcruiser from my friend in Japan after all.
I was thinking of buying a car in the UK but then wondered was it actually worth it and would I get value for money by doing so…
If you have any advice I would be glad to hear it…
Also, I had heard that if you live in the UK for over six months then there is no VRT when you bring the car back to Ireland? Would that be a better option?
Fiona, it is a complicated area to be sure, anyone considering acquiring or importing a vehicle would be well advised to consult the minutae of the text on revenue.ie
I rekon its still cheaper to buy a car from the uk. you just have to get away without paying the vrt for as long as you can. I bought a car in northern ireland a few weeks ago at a very reasonable price. The same car down here would be twice the price and wrecked from the joke roads we have. As for going to the UK and living there for six months to get free vrt i dont think its worth the hassle. My advice is drive away and dont pay them fools a penny until the gun is put to your head.
hi, im english but have been living over in ireland for over 6 years i own a car in uk but have only owned it for barely over 6 months…..ive rang the vrt people and they have said as i am technically living in ireland i will have to pay vrt on bringing the car into the country unless i can provide wage slips, statements, utility bills proving i am living in englabnd for last 6 months (which i cant)……what is the best way of avoiding vrt coould i get my dad to bring the car into the country and register it then sell it to me, will this work ????
please check out the excellent website www.irishdrivers.org to see what this association is doing to help all irish motorists regarding vrt, nct etc. Regards, John.
Better still go buy a car from lithuania the garda and customs Never touch them,