VRT Calc - Double Taxation?

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sonnyikea

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I searched the forums but could not find an answer - I wondered if anyone knows if the VRT calc, specifically based on the OMSP values, on secondhand cars is a double taxation. I was in the VRO the other day and asked the question and could not get a definate answer. They are looking to find out the answer for me but I wondered if anyone knew?

For example on my car the OMSP is around 12k. They add on 30% VRT 3.6k. Is my car then worth 15.6k? The VRO seemed to think that my car was only worth 12k. Which would be a double taxation in my book as the 12k OMSP already accounts for the VRT that would have been paid on the same type of car when new.

Surely the OMSP should be the new car price without VRT but with VAT and other taxes applied, minus the yearly depreciation?

If it is a double taxation how would one go about contesting this?
 
sonnyikea said:
If it is a double taxation how would one go about contesting this?
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Im not entirely sure what you mean by "double taxation" but I dont think any such principle is enshried in our leglisation or tax code in this country.

There was a discussion on "double taxation" here a few years ago, if I find it Ill post the link here.
 
your spot on. I've just realised it. The OMSP they quote includes the value of VRT on the price of a car here.
 
By double taxation - I mean does VRT exist in the OMSP. The OMSP price is derived from a number of means but ultimately is the price I would expect to pay on a dealers forecourt for the exact same car. Does this price include VRT which was paid when the car is new? Am being charged VRT on that price, hence my 'double taxation' question?

If, however, the OMSP is the value I would pay on a dealers forecourt minus the VRT percentage then it is a single taxation.

Maybe double taxation is the wrong terminology, I'm trying to work out if the OMSP is calculated incorrectly by already including an element of VRT.

I'd apppreciate the post if you come across it. The only mention I could find was VRT on top of VAT which was thought of as a double taxation.

Edit: I had the same issue with someone selling me something at cost. They told me to pay 30% of the cost of the item which included VAT and then to add 21% VAT on to that figure. I tried to explain that the 30% had an element of VAT in it and the final figure would have had two lots of VAT in it. They should have taken 30% of the ex VAT selling price and then added the 21% VAT onto that but he didn't understand me.
 
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There is also a double tax hit as the VRT is on the VAT inclusive price on a new car.

Tax on tax. it's sickening and expensive.
 
30% of 12k is €3600.

If you buy a car from UK they take it that you didnt pay 12k for the car. The Open Market Selling Price in Ireland includes, VAT, VRT and any other import duties.

So what they do is get the OMSP for your car and then calculate the VRT based on that. Then charge you the VRT which in this case is €3600. How much did you pay for the car in the first place??


if you end up paying more than the OMSP for the car (which includes buying from UK, adding VRT and so on and this ends up being more than the OMSP they give you then challenge this)
 
I found this thread which is on a similar vein but doesn't give any indication as to the calc for OMSP: http://www.askaboutmoney.com/archive/index.php/t-18326.html

Ronan - is that how the calc is supposed to work? The OMSP is slightly more than I paid for the car so with the VRT added it takes this way over. Are these grounds for appeal based on an incorrect OMSP?

From what you say the value includes VRT, so I am paying a figure of VRT which is based on an already assumed VRT payment which surely cannot be right. How does one go about escalating this? EU Commission?
 
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I also found this: http://www.courts.ie/judgments.nsf/...6dbe0c85d63b6a6780257156003a1408?OpenDocument

an extract of which is below:

As to how the OMSP of a used vehicle is arrived at, what is disclosed is that the second defendant takes the OMSP of the new equivalent as a benchmark. It then allocates a valuation depreciation category from 23 depreciation tables, which are drawn up to reflect the realities of the market. In each case the choice of benchmark and of valuation depreciation category is made by an officer of the second defendant who allocates a specific statistical code. This information is then inputted to a computer database maintained by the second defendant. This exercise will prompt an OMSP reflecting market conditions. The system also allows for reductions in the OMSP to compensate for excessive mileage and poor condition.


So does the OMSP of the new car include the VRT amount? Depends on whether VRT is classed as a tax or duty?

VRT is charged on the open market selling price (OMSP) of the vehicle. In the case of a used vehicle the OMSP is the price, inclusive of all taxes and duties which the vehicle might reasonably be expected to fetch on a first arm’s length sale thereof in the State by retail.
 
OMSP is based on the average selling price of that model car in this country, based also on milage, spec and so on.

If the price of the car goes up in some garages then VRT will usually also go up.


If i buy a car from UK for €6000, i will pay VAT for it in UK. When i bring it home I have to by IRISH law (and totally against EU law) pay VRT on the car to get it registered as an irish car. VRT can vary between about 20-35% of the OMSP of the car here in Ireland, not the actual value you paid.

If the car sells in Ireland for €12000, then i pay €3600 to Revenue for the privilage of having Irish reg plates.

This now brings the total i have paid on the car to €9600 plus any money paid on getting the car here. So if this car sells for €12000 here, i have saved €2400.

You need to do the maths pretty well when looking into bringing a car into Ireland. You can get stung big time.

And YES the EU have said that VRT is an Illegal tax and must be cancelled pretty fast, but it will be replaced by higher road taxes, fuel taxes and even a higher or seperate Vehicle VAT rate...
 
of course they will calculate the VRT based on a OMSP for a car inclusive of VRT. Sure how else can they calculate this price?? If they were to calculate VRT based on the price of the car less VRT then they would have a wrong VRT amount.
 
RonanC said:
of course they will calculate the VRT based on a OMSP for a car inclusive of VRT. Sure how else can they calculate this price?? If they were to calculate VRT based on the price of the car less VRT then they would have a wrong VRT amount.
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No they wouldn't they would have a right VRT amount. That's the point. The OMSP is calculated incorrectly. 20-30% of the OMSP is VRT so therefore the VRT is 20-30% more than it should be.

Based on the logic - I should be able to go to a dealer's forecourt and find a new car for whatever the revenue think the OMSP is for that new car. However I won't be able to because the VRT is applied on this amount - every single new car is 20-30% more than the OMSP.
 
what does the open market selling price of any item mean??

an item for sale to the public that includes all taxes and charges.
 
do you fancy taking this to the courts then? I'm sure you would get a lot of backers to finance your costs. Start a thread looking for funds and we'll all chip in. You could be the next Mark Bosman.

Can you imagine the person in this country who managed to get it removed....a NATIONAL hero
 
i'd definitley be intertested in chipping in on a challenge to the courts. could we do it if we get enough parties? we would need an approx figure of how much it would cost (which would be very hard to estimate,) and how much money people are prepared to lose?
 
RonanC said:
what does the open market selling price of any item mean??

an item for sale to the public that includes all taxes and charges.
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If you take my example then you would never find the item for sale to the public for that price. I understand what an OMSP is, what I don't understand is how that price is derived and whether or not the VRT calc is accurate.

The legal dispute that I included in my previous threads should uncover whether or not the calc used for the OMSP is accurate and fair so I will be keeping an eye on that. Although considering it started back prior to 99 I don't hold out much hope for a speedy conclusion to the case.

As for taking this further I am all up for doing what I can but where do you start? I'm not disputing the legality of the VRT payments from an EU free movement position what I am disputing is the calculation used to derive the figure that VRT is based on.

I'll be sure to try and get an actual answer when I am appealing my VRT payment and I'll post back here with any updates.

Thanks to all for your input.
 
tosullivan said:
do you fancy taking this to the courts then? I'm sure you would get a lot of backers to finance your costs. Start a thread looking for funds and we'll all chip in. You could be the next Mark Bosman.

Can you imagine the person in this country who managed to get it removed....a NATIONAL hero
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I'm sure Eddie would love to help out.
VRT is a tax, and a pretty fair one at that, if it's removed that money will have to come from elsewhere.
I can't see why the EU would comment on VRT as it is an internal road tax that does not hinder free trade etc, given that, I don't see what grounds there are for a legal challenge, sure we may as well take a legal challenge against income tax too.
 
Glenbhoy said:
I'm sure Eddie would love to help out.
VRT is a tax, and a pretty fair one at that, if it's removed that money will have to come from elsewhere.
I can't see why the EU would comment on VRT as it is an internal road tax that does not hinder free trade etc, given that, I don't see what grounds there are for a legal challenge, sure we may as well take a legal challenge against income tax too.
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Are you insane? VRT is not one bit fair. It stops the free movement of goods around Europe. Very clearly anti EU.

If you lived in the UK you could easily go to say Belgium and buy a cheaper new car there than was available on the local forecourt. Many people do so.
 
VRT has nothing to do with Road Taxes.. We do have a very expensive "Road Tax" too..

VRT is a form of DOUBLE taxation in the context of paying VAT on a vehicle and then VRT on top of that.

IF i win the EuroLotto this evening and there's no hope in hell of that happening, but let me dream a little, i'll buy my car from Mainland Europe and drive it back here and Will not pay a single cent in VRT as I will have bought a lovely villa on the south of France, to which the newly purchased vehicle will be registered to and I will visit this lovely country on my Holidays...
 
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