Must I pay VAT or VRT on my car when I transfer residence to Ireland?

If you refer to our forum, you will see one of the most common questions asked is how does one get exemption from VRT and VAT when transferring residence to Ireland?

If you import a car from outside the EU you are required to pay VAT. Its important to note that some EU territories are excluded from the EU for VAT purposes also, please refer to bottom of this page.

In order to qualify for relief from VAT you must have had your normal residence outside the EU for a continuous period of at least 12 months prior to transfer. VAT relief is treated separately to VRT relief in the case of non-EU importations.

Regarding VRT you must meet residency requirements and your motor vehicle must meet certain conditions.

The residency requirements are as follows:

For VRT purposes you must have had your normal residence as defined below, outside the State at the time of transfer. In the case of a transfer from outside the EU, you must have had your normal residence outside the EU for a continuous period of at least 12 months prior to transfer.

Normal Residence means:

• the place where you usually lived, for at least 185 days in the year ending on the date of transfer, because of occupational and personal ties
• if you had no occupational ties, the place where you usually lived for at least 185 days in the year ending on the date of transfer, because of personal ties
• if your occupational ties were in a different country from your personal ties then the country of your personal ties is taken as your normal residence if you returned there regularly (i.e. for most of your non-working days)

Exceptions:

People in the follow circumstances do not qualify for relief:

• Students/individuals living abroad for the primary purpose of pursuing a course of studies.
• Individuals working abroad on a task of duration of less than one year and with personal ties remaining in the State
• Individuals working abroad on a task of duration of more than one year who have been granted tax relief in respect of another vehicle in the previous 5 years.

Motor vehicle requirements:

• it must be your personal property
• it must have been acquired with all the appropriate local taxes paid and these must not have been exempted, or refunded in any way. (There are certain exceptions in the case of diplomats and members of international organisations recognised by the Department of Foreign Affairs.
• you must have had possession of and have actually used the vehicle outside the State for at least 6 months before your transfer to Ireland. In the case of relief from import charges, you must have used the vehicle at your former normal place of residence. Any possession and use in the State, even during times when you were living abroad, does not count
• you must bring the vehicle into the State within 12 months of the date of your transfer of residence.

Conditions Regarding Proof of Residency:

You will be required to produce sufficient evidence to show that you have been living abroad for the required length of time. You will also be required to show that you are taking up residence in the State. The evidence required includes documents relating to:

• the acquisition and disposal of property abroad and in the State (e.g. rent agreements, mortgage documents, rent/mortgage payments etc.)
• employment abroad and in the State (e.g. payslips, tax records, social welfare records etc.)
• other transactions carried out in the course of day to day living (bank statements/transaction documents, bills/receipts for electricity, phone, service charges and other day to day living expenses)
• travel records connected with trips into and out of the State
• other such evidence as requested in individual cases.

Remember the onus is on you to prove that you were resident abroad for the stated period. If the necessary documentary evidence is not furnished, tax relief cannot be granted.

Conditions Regarding Vehicle:

You are required to prove that you had possession of and actually used the vehicle abroad for at least 6 months before transfer and that the appropriate local taxes have been paid and not refunded. This proof will usually consist of:

• the vehicle registration document
• the certificate of insurance
• the sales invoice, receipt of purchase or other similar document
• evidence of the date on which the vehicle was brought into the State (e.g. sailing ticket)

You may also be requested to produce other evidence (e.g. evidence of maintenance and use of the vehicle).

After receiving exemption, can I sell the vehicle?

You may not sell, dispose of, hire out or lend the vehicle during the 12 months following the date of registration. If you do, the VRT (and Customs duty and VAT if appropriate) must be paid in full.

Where does one apply?

Transferring from within EU: ontact your local Revenue Office (click here).

Transferring from outside EU: Customs Office at the point of arrival in the State.

Forms:

• Form C&E 1077(on transfer from within the EU)
• Form C&E 1076(on transfer from outside the EU)
• Form VRT 4(motor vehicles)
• VRT 5(motor-cycles)

Producing Required Documents:

You will be allowed up to 30 days from the date you lodge your application. In that case you will be issued with an acknowledgment slip (Form VRT 25) which should be carried in the vehicle until registration has been effected.

Disclaimer: The above information is for informational purposes and not a full/comprehensive interpretation of the law.

EU Territories which are Excluded from the EU for VAT purposes(June 2004):

• Channel Islands, Gibraltar, Andorra, San Marino. Canary Islands, Ceuta, Melilla (Spain).
• Livigno, Campione dItalia, Italian Waters of Lake Lugano (Italy).
• French Overseas departments, i.e. Guadeloupe, Martinique, Reunion, St. Pierre and Miquelon and French Guiana.
• Faroe Islands, Greenland (Denmark).
• Island of Heligoland and Territory of Busingen (Germany).
• Mount Athos (Greece).
• That part of Cyprus over which the EU member does not exercise effective control.