Importing a car to the UK is an exciting prospect, whether you’re looking for a unique model, better features, or simply hoping to save some money. However, the process involves various steps and costs that must be carefully considered before you start to get too excited.
To give you an idea about the costs involved in importing a car to the UK and other important information, the below guide walks you through everything you need to know.
The Costs To Import A Car To The UK
Importing a car to the UK involves several costs that can add up quickly, and below is a typical breakdown of what you can expect:
- Purchase Price: This is your starting point and will vary widely depending on the car’s make, model, and condition.
- Shipping Costs: The car can be transported to the UK via container shipping or roll-on/roll-off (RoRo) methods. Depending on the distance and shipping method chosen, shipping costs can range from as little as £500 to £2,000 or more.
- Customs Duty: The UK charges a 10% customs duty on the car’s value, calculated on the car’s purchase price and shipping costs.
- VAT: In addition to customs duty, you’ll need to pay 20% VAT on the total value of the car, including the purchase price, shipping, and customs duty.
- Import Duty for Older Cars: If you’re importing a classic car (over 40 years old), you may qualify for a reduced rate or even an exemption from VAT, depending on the vehicle’s condition and whether it meets specific criteria.
- Registration Fees: Once your car arrives in the UK, you’ll need to register it with the DVLA (Driver and Vehicle Licensing Agency). The registration fee is usually around £55.
- Compliance Costs: The car must meet UK road standards, which may require modifications such as changing the headlights, speedometer, and emissions systems. The cost of an IVA (Individual Vehicle Approval) test can range from £150 to £450, plus any necessary modifications.
- Insurance Costs: Insuring an imported car can be more expensive than a standard UK car. Therefore, it’s essential to find a specialist insurer (such as ourselves) who understands the unique aspects of imported vehicles.
- Other Costs: Remember additional expenses such as storage, currency conversion fees, and any unforeseen costs that might arise during the import process.
Example Breakdown Costs of Importing A Car To The UK
Let’s assume you’re importing a used car from Japan with a purchase price of £10,000. Here’s how the costs might add up:
- Purchase Price:
- £10,000 – The initial cost of the car in Japan.
- Shipping Costs:
- £1,200 – Roll-on/roll-off (RoRo) shipping costs from Japan to the UK. However, you can opt for the more expensive container shipping, which costs around £1,500 to £2,000.
- Customs Duty (10%):
- £1,120 – 10% of the car’s value (£10,000) plus the shipping cost (£1,200).
- Calculation: (Purchase Price + Shipping) x 10% = (£10,000 + £1,200) x 0.10 = £1,120.
- VAT (20%):
- £2,464 – 20% of the total value (Purchase Price + Shipping + Customs Duty).
- Calculation: (Purchase Price + Shipping + Customs Duty) x 20% = (£10,000 + £1,200 + £1,120) x 0.20 = £2,464.
- Import Duty for Older Cars:
- N/A – No reduced VAT rate applies since the car in this example is not over 30 years old.
- Registration Fees:
- £55 – DVLA registration fee for registering the car in the UK.
- Compliance Costs (IVA Testing and Modifications):
- £500 – Costs for modifications to ensure the car meets UK standards, such as converting the headlights, speedometer, and emissions.
- £250 – IVA (Individual Vehicle Approval) test fee.
- Insurance Costs:
- N/A – Due to the difference in premium caused by factors such as the car and driver, we won’t include this as a direct cost.
- Other Costs:
- £100 – Miscellaneous fees, such as currency conversion charges and document handling.
Total Estimated Cost:
- £15,689
Breakdown Recap:
- Purchase Price: £10,000
- Shipping Costs: £1,200
- Customs Duty: £1,120
- VAT: £2,464
- Registration Fees: £55
- Compliance Costs: £750
- Other Costs: £100
Total: £15,689
Popular Counties To Import A Car From
As a specialist car insurance broker who deals with imported cars on a daily basis, we certainly see a trend in where people import their cars. However, the two most popular countries include:
America
The US is a popular choice for importing cars, particularly muscle cars, trucks, and models that are not available in the UK. For example, our American car insurance policy covers a range of imported vehicles such as Dodge RAMs, Chevrolet Camaros, classic Ford Mustangs, and much more.
The main benefit of importing a car from the US is that the larger market often means competitive pricing and the variety of vehicles is unmatched, considering the limited supply of American cars in the UK.
Japan
Japanese imports are very popular for their selection of high-performance (i.e. JDM (Japanese Domestic Market)) cars, unique people carriers, and Kei cars. From the all-so-famous R34 Nissan Skyline to a Toyota Alphard, there is a huge range of cars that you can import from Japan.
However, one of the main reasons Japanese import cars are so popular is that the country drives on the left side of the road, meaning the majority of the cars are right-hand drive. This is reflected in our policies because Japanese import insurance is one of our most popular forms of imported car insurance.
Pros & Cons of Importing A Car
Pros:
- Cost Savings: Despite the import costs, you might save money compared to buying the same model in the UK.
- Unique Models: You can access cars not available in the UK, allowing you to own a rare or unique vehicle.
- Custom Specifications: Some cars have features or specifications tailored to different markets, which may not be available in UK models.
Cons:
- Higher Upfront Costs: While the car might be cheaper abroad, the import process involves significant upfront costs.
- Complex Process: Importing a car is not as simple as buying one locally, and the process involves numerous steps which can be time-consuming. If you are unsure of the process, read our American and Japanese import guides.
- Potential Issues: Risks include compliance challenges, potential damage during shipping, and difficulties in finding parts or servicing once the car is in the UK.
Insuring Imported Cars
When it comes to insuring your latest imported purchase, at Brentacre, we are specialists and can ensure that the process is smooth and affordable. Whether you want an insurance policy with modifications or you’ve imported a vintage vehicle and require classic car insurance, neither is an issue for us. We can even insure your imported car using the chassis number until your UK registration comes back (up to 30 days).
Final Words
Importing a car to the UK can be a rewarding experience, but it’s important that you understand the full costs. Hopefully, our guide has answered everything you need to know about the costs, but if not, feel free to get in touch, and we will try to help out where possible (particularly when it comes to insuring it!).
