Importing a second-hand car from Northern Ireland could be a useful money-saver, and there are some significant differences between bringing a car directly across the Irish border and bringing one in from the rest of the UK.
That's because of Northern Ireland's special status post-Brexit. Does that mean cars from the North count as already being in the EU? For the most part, yes - although there is still something of a tripwire in the small print.
First off, the requirement to pay Vehicle Registration Tax, or VRT, applies whether a car is brought in from England, Wales, Scotland, Northern Ireland or indeed any other country. Being in or out of the EU makes no difference to that.
Don't forget, as well as paying VRT, you'll also have to pay the NOx levy - this is effectively a tax on older diesel engines and won't cost a lot on a petrol or hybrid car. It's zero for electric cars.
Get your paperwork together
If you're bringing a car in from Northern Ireland you'll need to bring it for an NCT within 30 days of it arriving in the State, and you'll need to bring along paperwork including a customs declaration showing the date of arrival of the vehicle in Northern Ireland, with the identification of the vehicle clearly marked; a copy of an invoice from a transport company identifying the vehicle and delivery date; tax and insurance details indicating use in Northern Ireland; and a copy of the V5C registration document showing the last registered keeper in Northern Ireland and a date of registration to that keeper.
For cars in Northern Ireland before 2021
Cars registered in Northern Ireland before the January 1, 2021 are counted as having been registered within an EU member state (because of the complexities of the UK's withdrawal from the EU, which began in 2016 but only officially concluded in January 2021) and so you will pay no VAT nor any customs charges to bring one of those cars across the border.
That applies irrespective of the age of the vehicle itself. So, whether the car was first registered in the UK in 2020, or any year prior, as long as it arrived in Northern Ireland before midnight on the December 31, 2020 - and supplying proof of that arrival is critical - it will be VAT and customs duty free if you buy it and import it to the Republic of Ireland.
For example: A 2019 Ford Fiesta, first registered to a buyer in Manchester and subsequently traded in to a dealer in Northern Ireland in November 2020. That car is treated as an EU-registered vehicle, and as such you will not have to pay customs duty nor VAT.
VAT on importing cars from Northern Ireland
VAT, remember, is currently charged at 23 per cent on the "customs value" of the vehicle. Usually this will be the purchase price plus the cost of transport and insurance plus any customs duty payable. Customs duty (sometimes called import duty) is usually ten per cent of the paid price of the car plus shipping costs, but for most cars coming into the Republic from Northern Ireland, this will not apply anymore.
Incidentally, if you're importing a new car built in the UK, then customs duty does not apply (another quirk of Brexit), but it will apply to all used vehicles.
For cars brought into Northern Ireland after 2020
Thankfully, Revenue has simplified its rules on importing used cars from Northern Ireland. Previously, there had been something of a fog of differing rules on the age of the car, the time of entry into Northern Ireland and whether the car had been in use in Northern Ireland for a notional ‘reasonable period of time.’
All of this has largely been done away with now, and replaced with something that on the surface is far, far simpler albeit with one caveat.
Now, according to a statement from Revenue: “A vehicle that has previously been in use in Northern Ireland can be registered for VRT in the State, without liability to additional Customs duties and import VAT. Proof will be required that the vehicle has been in private ownership for a reasonable period of time - a copy of the V5C showing the last registered keeper in NI and the date of registration to that keeper. Vehicles that have not previously been in use in Northern Ireland will require proof that the vehicle has been imported to Northern Ireland in accordance with the requirements of the Windsor Framework. A copy of the customs declaration lodged in Northern Ireland that clearly identifies the vehicle being registered must be provided.”
According to Revenue’s more extensive notes on importing cars from Northern Ireland: “Under the Windsor Framework, Northern Ireland will continue to apply and adhere to EU rules in relation to trade in goods. The result is that there are no Customs formalities, including Customs declarations or payment of tariffs, on trade between Ireland and Northern Ireland.”
That sounded suspiciously as if, effectively, there’s now no VAT at all to be paid on cars coming from Northern Ireland, that as long as the car you’re buying has been brought into Northern Ireland in compliance with the Windsor Framework (and you should definitely check with the dealer you’re buying from that this is the case) then no Customs duty nor VAT should apply.
Just to be sure on this point, CompleteCar.ie checked with the Revenue Commissioners, and here’s the response we received:
“The VAT applicable on the importation of a vehicle into the State depends, broadly, on whether or not the vehicle has EU ‘union goods’ status - i.e. it is originally from, or has been correctly imported into, NI or elsewhere in the EU, and is a new means of transport - i.e. it has been in use for 6,000km or less, or was first registered six months ago or less.
“Where a vehicle has EU ‘union goods’ status, it will be subject to Irish VAT if the vehicle is a new means of transport and is brought into the State from within the EU. Where a vehicle does not have EU ‘union goods’ status it will be subject to Irish VAT irrespective of whether the vehicle is a new means of transport or not.
“Revenue will consider that a vehicle has been imported to NI in accordance with the Windsor Framework where a copy of the import declaration lodged in NI, or proof that the vehicle has been in private use in NI for a reasonable period of time, is provided as part of the VRT process. What is considered to be a reasonable period of time, for the purposes of private use, depends on the facts and circumstances of each case.”
There you have it - no VAT nor Customs Duty for imports from Northern Ireland. The only caveat is ensuring that the Windsor Framework has been correctly followed.
How can you be sure that a car you’re looking at has been correctly imported to the North via the Windsor Framework?
In one sense, it’s relatively simple. If a car has been brought to the North from the rest of the UK, and registered into private ownership there, then it has been correctly imported. To prove this, you’ll need the V5C registration document, which must show that the previous owner was a resident in Northern Ireland.
If you’re buying the car from a dealer, then you’ll need some more paperwork, specifically a copy of the customs declaration lodged in NI (that clearly identifies the vehicle being registered there) to demonstrate that the vehicle has been imported to NI in accordance with the Windsor Framework. If you can’t show that important piece of paperwork, then Revenue will assume that the car hasn’t been properly registered in NI, and so will apply both VAT and Customs Duty.
So, yes, there are some potential savings to be found by shopping for second-hand cars in Northern Ireland, not to mention the simplicity of being able to get there and back without recourse to a flight or a ferry. Do your homework, keep your paperwork in order and you could save yourself some money, but double-check all your facts before you commit to bringing the car home.
Dealers can claim the VAT back
While VAT effectively no longer applies to used car imports from Northern Ireland, there is also a potential benefit to bringing in a new (or nearly new) car from up North, thanks to the potential to claim back at least some of the VAT.
From May 1, 2023, the UK government introduced the Second-Hand Motor Vehicle Payment Scheme (SHMVPS), which replaced the old margin scheme. That allows car dealers who are VAT-registered in Northern Ireland to reclaim the VAT element of the vehicle cost if the vehicle is purchased in Great Britain and removed or exported from there by the purchaser or by the GB dealer. This also means that Irish car dealers will now be in the same position as NI car dealers when purchasing a qualifying vehicle from Great Britain.
In other words, the dealer selling you the car can claim back the UK VAT portion of the price and can pass that saving onto you. It's not a total saving - UK VAT is charged at 20 per cent and you'll still have to pay Irish VAT at 23 per cent - but at least it's some kind of saving on the price of importing a new car. However, there's no onus on the dealer in Northern Ireland to do this; you might need to use it as part of your bargaining process, although some dealers will doubtless advertise it up front as a potential incentive for cross-border shoppers.
Ask us for help
The above is our interpretation of the rules, as laid out by Revenue, but even we realise that it's not all as clear as it could be. Feel free to send us your queries via the Ask Us Anything page and we'll do our best to help.
Further reading
How Much VRT is Paid in Ireland?
Motor Road Tax Prices in Ireland Explained
Guide To Importing Cars From The UK