FAQs
UK VAT Q Car Souring Specialists
Sourcing the right specification of car, which is VAT qualifying, for the right price can be extremely difficult - especially if you want to avoid a lengthy waiting list. With our motor industry experience, HDVE will source the perfect car to your exact specifications, saving you time and money. We specialise in VAT Q cars ready for immediate export. We have clients in various countries around the world including Malaysia, Malta, Northern Cyprus, Singapore and Thailand.
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Be aware - various car dealers will ask you to pay the 20% VAT upfront and agree to return it once they have reclaimed. This is an unnecessary risk for clients as there are no guarantees the VAT will ever be returned to them. We pay the upfront VAT and handle the reclaim ourselves so you will never be charged it or have to worry about long processes to get it back!
What is VAT?
Value Added Tax is the tax applied to goods and services by HM Revenue and Customs (HMRC). VAT for a car is 20%. This is included in the advertised price of a car if it is deemed VAT qualifying. In specific circumstance buyers can reclaim the VAT for their car and reduce the price by 20%.
A car is defined as VAT qualifying if it is either a brand new car and being purchased by a company or individual who is VAT registered OR has only ever been owned by a business for business purposes since first purchase.
You may come across the term gross VAT qualifying which means the vehicle has been registered to a business and so the VAT is still reclaimable.
Savings for (Non EU) Export Customers Buying VAT Qualifying Cars
Buying a VAT qualifying car for export may be the biggest 20% saving you'll ever see. There is a large demand in UK for VAT Q cars to be exported. To illustrate why, imagine the purchase price of a VAT qualifying car is advertised as £120,000. If this car is exported to you in a non-EU country, the price drops to £100,000 as we can reclaim £20,000 from HMRC once the vehicle is exported.
Overseas buyers can save 20% VAT off the advertised price of a VAT qualifying car by using our services. This is because when we purchase a VAT qualifying car on your behalf we ourselves pay the VAT so it is taken off the sale price. We can reclaim the VAT from HMRC so long as the car is exported permanently outside the EU. Doing it this way means you don't have to go through the VAT reclaim process, we take the burden on ourselves!
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How Do I Reclaim the VAT on Cars for Export?
You have several options to consider if you want to buy a UK car and reclaim the VAT.
1. You could apply to reclaim the VAT yourself.
You will need to prove the car has been permanently exported and provide all documents in the correct way. Considered a risky choice, and we have been advised by a top accountant that this is no longer possible if you are based outside of the UK.
2. A dealer wants to return the VAT to me post sale.
Another high risk strategy as you are in a different continent. We hear of many cases where the money never materialises, owing to an ‘admin error’.
3. My friend in the UK could reclaim the VAT?
Being a UK resident isn’t enough. Your friend would have to be the registered owner of a UK VAT registered business. They would then process the application for you deal with an accountant and HMRC.
4. Buy a VAT qualifying car from a UK main dealer.
It is very unlikely that any UK dealers will support you. Cars are in such short supply they are prioritising selling to UK clients. Most UK main dealers are not set up to support VAT reclaim, so will refuse the sale in the initial conversation.
5. Speak to HDVE and buy via a professional car exporter.
We will pay the VAT on your behalf and arrange insured shipping so it is totally risk free. This is the most cost effective and straight forward way to buy your car VAT free.
Already Found a VAT Qualifying Car?
If you have already found a car in the UK, that's a great start! We can step in and manage the purchase for you from checking the VAT status to inspecting the vehicle and finally, shipping it to you.
FAQS
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What does non-VAT qualifying mean?Any car or vehicle which has been owned privately or used for personal use at any point in its lifetime becomes non-VAT qualifying. The VAT is no longer reclaimable and the VAT qualifying status cannot be reinstated no matter who buys it.
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Benefits of VAT qualifying cars for UK customersThis saving isn’t just for exporters. UK buyers who are VAT registered can also reclaim the 20% VAT if they are buying a VAT qualified car for business purposes.
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Is there VAT on new cars?All new cars are begin life VAT qualifying. If they are registered to a UK VAT registered business they remain VAT qualifying. But if they are registered to a private individual they become non-VAT qualifying.
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Is there VAT on used cars or second hand cars?A used or second hand car will also be VAT qualifying if it has remained registered to businesses throughout its lifetime. It becomes non-VAT qualifying once it is registered to a private owner and the VAT cannot be reclaimed. It is fairly common to be able to find cars up to 4 years old which are still VAT qualifying. Although older the car you are looking to buy, the fewer there will be to choose from.
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VAT on leased carsIf you are buying an ex-lease car from a business then there’s a good chance it will be VAT qualifying because it was purchased for business use.
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What does non-VAT qualifying mean?A non-VAT qualifying car is not eligible for the 20% VAT to be reclaimed. This is because the vehicle has been owned by a private individual. Once this has happened a car looses its VAT qualifying status to become non-VAT qualifying. This cannot be reversed.
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What does "VAT margin car" mean?A VAT margin car is a car which is non VAT qualifying. This is because the VAT has been paid on it in a previous sale and this cannot become a VAT qualifying car again.
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Do you pay VAT on new cars?All new cars are VAT qualifying. They have to be bought by a VAT registered business in the UK in order for the VAT to be reclaimed. If this happens, the car remains a VAT qualifying car until it is bought by a person or a non-VAT registered business. This person must pay the VAT for the car which then becomes a non-VAT qualifying car ongoing.