Importing a new Merc/BMW

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cward033

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As I live in one of the border counties and work in Northern Ireland, is the following legitimate?

I was thinking of moving to NI for 6 months and buying a new Merc/BMW immediately.

I would intend to move back to ROI after the 6 month period, then clear the vehicle at customs without paying VRT, and finally sell the car on at a nice profit.

Is this legitimate?
 
Almost. According to this:

You have to wait for 12 months after importing before you can resell.
 
Anyone ever worked out is it best to buy new or maybe something nearly new?

With a brand new car you obviously save more VRT but you are also likely to take a big depreciation hit. As the biggest depreciation hit tends to be in the first year or so I am wondering might the lower depreciation on say a one year old car outweigh the extra VRT you would save on the newer car?
 
Given that VRT is (in most cases) 25%, you would have to buy a car with quite a bad resale value to lose over 25% in one year.
 
CCOVICH said:
Given that VRT is (in most cases) 25%, you would have to buy a car with quite a bad resale value to lose over 25% in one year.
Click to expand...

But you still save the 25% VRT on a second hand car too, its just going to be based on a lower market value. My point is you have to hold onto the car for 18 months (6 in NI and 12 in Ireland), the car is likely going to depreciate a lot more over the first 18 months than over say months 12-30. You save less VRT but lose less depreciation.
 
If you can legally avoid the VRT, importing makes a lot of sense.

2nd hand values are much higher here.

Go for a car with relatively low depreciation, and which will sell on readily.

3 series BMW perhaps?
 
Yeah I guess that makes sense.

Let's try some maths:

Buy new BMW E60 520iSE, Petrol, Manual £25,545 (=€38,705 at ER £0.66) Price taken from honestjohn.co.uk

Revenue OMV (based on car purchased in July 05) €49,937 (Stg. 32,958)
Rate of VRT = 30%
VRT payable = €14,918
Total cost = €38,705*1.21=€46,833+€14,918=€61,751

Note: VAT @21% needs to be added (I don't think there is any allowance for UK VAT?)

Buy used BMW 520iSE 2004 in UK £23,000 (Approx. based on Autotrader.co.uk = €34,848)

Revenue OMV (based on car purchased in Jan. 04 10k miles) €46,741 (Stg £30,849)
Rate of VRT = 30%
VRT Payable = €13,941
Total cost = €34,848+€13,941 = €48,789

If you buy new, VAT @ 21% is payable (I presume that this is included in the Revenue OMV)

I have tried to be as accurate as possible with the figures, but the value of the used car in the UK might not be entirely accurate.
 
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If you are going this route you may save even more by buying the car from a Southern dealer for export to the 6 counties. Check with the dealers what the price for export would be (I'm sure they are well used to quoting this way) and compare with what the price is from the norn iron dealers is.

Importing from the south has an additional benefit in that the only bit you have to pay in stg is the 17% vat rate when you stick the yella plates on her.

A 320d or a merc C220 cdi would probably be the best performers in the depreciation stakes.
 
Be sure your comparing apples with apples. The OEMs ensure their cars have different specifications in each market to minimise parallel imports/exports. If your car isn't standard spec in the local market your residual will probably suffer.
 
Lemurz said:
Be sure your comparing apples with apples. The OEMs ensure their cars have different specifications in each market to minimise parallel imports/exports. If your car isn't standard spec in the local market your residual will probably suffer.
Click to expand...

I have done my best to ensure that is the case, the car in question is a BMW E60 520iSE (both used and new). I will research the UK used price a bit more to make sure it's accurate.
 
thanks for all the replies

slightly confused by all the maths - to get an idea of the profit of buying a new BMW E60 520iSE for £25,545 (=€38,705 at ER £0.66), should we not be comparing this to the price of a same 1.5 year old (18 month in total) in the same model in ROI to calculate the profit, if any?
 
Used 2004 520iSE, roughly €50,000 (for range of prices see Carzone)
New 520iSE, €55,000 (see [broken link removed] and )

So buy used in Ireland: €50,000
Buy used in UK: €48,789

Profit/savings: €1,211 (even if you take it over yourself on the ferry, it will probably cost at least €200 to transport, so have to factor this in as well)

Buy new in Ireland €55,000
Buy new in UK €61,751

Profit/savings: (€6,751)

So buying new actaully costs more if buying in the UK??? Probably not. If you look at the CBG link above:

CD Changer €595
Climate Control €1,350
Sunroof €1,520
Metallic Paint €1,230
17" Alloys €1,020

Adding all of the above (I couldn't imagine not having any of these if you're buying a 5 Series) brings the total (new) cost in Ireland to €59,995. Adding leather seats @ €2,690 brings the cost to €62,685.

I'd say the € equivalent of buying in the UK might be overstated due to the VAT, as I don't quite know what the story is when calculating VAT on new cars.

Wow this is fun!!!

I'm sure I've missed something in all of the above calcs. but I'm just trying to present a rough idea of what the costs are. Also, you could do better importing from elsewhere in Europe
 
CCOVICH said:
I'm sure I've missed something in all of the above calcs. but I'm just trying to present a rough idea of what the costs are. Also, you could do better importing from elsewhere in Europe
Click to expand...

I don't understand your figures at all, why are you adding the VRT to the UK price? I though the whole point was to avoid the VRT by buying while resident in the UK.
It also appears that VAT would not be payable after 6 months if you have more than 6000km on the clock. Your calculations seem to be whether it is better to buy from the UK or Ireland for Irish residents who are paying VRT any way.

I would have thought the relevant calculation is

Cost in UK new converted to euro
less second hand value in Ireland of 18 month old car.

If we then want to compare whether it is better to buy say a one year old car then it is

Cost in UK of one year old car converted to euro
less second hand value in Ireland of 30 month old car.
 
The base price, before VAT and VRT of all new cars in ireland is actually one of the very lowest in Europe.

Explains why so many are reexported.

If you can legally import a lightly used UK car without VRT, you are likely to make a tidy profit when selling it on after 12 months.
 
Sorry, you're right. I was ignoring the fact that the the strategy would be to buy in the UK and hold for 6 months and then import. All the figures are there though, you just need to make the necessary adjustments.
 
Maths aside be fully aware that customs know all the loopholes and are quite partial to making you pay up the full amount of vrt unless they are completely satisfied (with documented proof) that you are legitimately living and working in the UK.
 
That's only fair enough I guess.

VRT is a repugnant tax however. Levied on the motorist and wasted elsewhere.
 
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