FAQs - VAT when buying or selling a car
I live in Belgium and want to buy a new car in Denmark. I know that I will need to go through Belgian customs and pay Belgian VAT. My sales receipt is in Danish krones. How will VAT be calculated, since I will be paying it in a country that uses the euro?Customs will convert the price paid in Danish krones to euros. You will pay VAT at 21% of that amount (the rate applicable in Belgium).
Customs will use the value of the Danish krone against the euro on the date shown on your sales receipt. If there is no sales receipt, it will use the date on the purchase order.
The car I want to buy is three months old and already has 3 500 km on the odometer. It's being sold to me as a new vehicle. Is this legal?YES - A car sold in the EU is considered new if:
— you take possession of it less than six months from the date it first went on the road
— the vehicle has been driven less than 6,000 km.
I bought a new car in Italy and paid VAT there. I live in France and now I want to register the car here. To do that, the French authorities are asking me to pay VAT in France. Is this normal?YES - if you buy a new car, you have to pay VAT in the country where you register it. In your case, this would mean paying VAT twice on the car. But you are entitled to a refund of the VAT you paid in Italy.
You should send a proof of payment of the French VAT to the Italian seller and request the refund of the VAT you paid in Italy. If the seller refuses to reimburse you the VAT, you can take this up with the Italian tax authority .
I live in France. I bought a new car from a dealer in Belgium and paid VAT on it. Now I have been asked to pay it again as I am registering the car in France. Surely that is wrong?
YES / NO — You cannot be made to pay VAT in more than one country, and VAT on cars is payable in the country where they are to be registered, i.e. France (not in the country where they are bought — the rule for most other goods).
You could have told the dealer that the car was intended for registration in France, and avoided paying Belgian VAT.
Since you already have paid Belgian VAT, you should now apply for a VAT refund from the Belgian tax authorities, based on evidence from the French authorities that you have registered your car in France within 6 months of it first being put on the road and before it has clocked up 6,000 kilometres.
I plan to buy a car in Germany and drive it back to France, where I live. How should I register it?
Although the car will eventually have to be registered in France, you still need to get German licence plates to drive it back to France. If the car is new, you should get transit licence plates — this will also allow you to avoid having to pay VAT in Germany. If it is a used car, you will probably have to get ordinary German registration, even for a short period. Consider having the car shipped to you in France, so you don't need to register it in Germany, and compare the costs.
I am Irish and I have retired to Malta. I brought my car with me but when I registered it in Malta, I was asked to pay excessively high import taxes. I thought import duties had been abolished in the European single market?
Import duties have been abolished within the EU. Perhaps the charges are in fact vehicle registration and road taxes — payable on all cars registered in a given country, regardless of where they come from. These taxes are not regulated by EU law, and you must pay them — provided they do not discriminate against imported cars. For instance, the registration tax should not be higher than the tax value of a similar car already registered in Malta.
I am moving from Belgium to Portugal with my car. The Portuguese registration tax is very expensive. Isn't it unfair to have to pay such tax again when I have paid it already in Belgium, and Portuguese residents pay it only once on the same car?
Passenger car registration tax is not harmonized at EU level. EU countries are therefore free to levy a registration tax when a car is registered on their territory for the first time. Because of the disadvantages for people in your situation, it is currently up to each EU country to decide whether to grant an exemption for cars moved in connection with the owner's change of residence. You should contact the Portuguese authorities to find out whether your case qualifies for such an exemption, and if so, under what conditions.
I want to buy a car in Germany and take it back home to Holland to register it. Do I have to pay the VAT twice and then claim it back?
NO—Just tell the German seller you are going to register the car in another country. You will then only pay VAT in Holland.