UK Government Sticks It To Classic Car Buyers
Let’s pray this doesn’t happen in the US…
Starting Dec 31st 2020.
Wow!
UK tax hit on classic cars
- Thread starter teahead
- Start date
Starting Dec 31st 2020.
Wow!
Jamie B Patrick
Member
British government needs to fund Brexit somehow
Belgiumbarry
Well-Known Member
wow... is this also for private to private sell ???
if so , and you ( not me ) happen to have one, value 1M... who will pay the extra 200k tax ?
I don't think the buyer , that car isn't worth 1.2M from one day at another , .... i'm afraid owners will loose.
if so , and you ( not me ) happen to have one, value 1M... who will pay the extra 200k tax ?
I don't think the buyer , that car isn't worth 1.2M from one day at another , .... i'm afraid owners will loose.
When they voted for Brexit the consequences of importing from Europe was maybe overlooked. Self inflicted pain.
Italy has a 30 percent tax on classics from outside the EU. I think Netherlands was 6 and now is 9? And UK was 5.
My question is, do they tax paintings, coins, collectibles, the same?
My question is, do they tax paintings, coins, collectibles, the same?
100.00 for the car and I’ll give you 10,000.00 for a finders fee. Total; 10,130.00
day66
Well-Known Member
It looks a little like click bait to me. Conceivably VAT may become chargeable on purchases from continental Europe as the free movement of goods is most likely going to be impacted but I cannot see that VAT will become payable on private transactions in the UK.
I'd imagine only a very small percentage of British classic car buyers would want a LHD car in any event ..
Here in the NL it is tax free if you purchase it privatly from another person. If you buy at a shop, it's 22%, same as any second hand car. And that is not high:
Buy a new car in NL and its 35% taxed. The difference between Germany and the Netherlands is roughly drving a 3 series in NL costs you about the same as a 5 series in Germany.
Our best sold car in 2018 was a VW Polo...
In the UK gains in value of your car are one of the few 'investments' that are tax free - I don't know how that compares to the rest of the world ?
Well, in the US your "supposed" to declare the gain. So for example, if you bought an old 50s Ferrari for 20 and now you sold it for 15mil, you'd have to pay capital gains. We should all be so lucky...
Well In Ma, when you buy a used car, if you buy it for X and it is worth 2X by the state's book, they tax you on 2X. If you buy it for 2X and it is only worth X by their book, they charge you tax on 2X.... In the private sector that would be thievery.
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We have 10% sales tax here in WA state.
Of course, ALL my cars are condition #5 when I go to get a title for it.
Of course, ALL my cars are condition #5 when I go to get a title for it.
Actually the Washington State sales tax is 6.5%. Some counties and cities tack on an additional sales tax. Here in Bellingham the total is 8.7%We have 10% sales tax here in WA state.
Of course, ALL my cars are condition #5 when I go to get a title for it.
I usually buy "builders" for well under any "book" value. I always have the seller fill in the sales amount on the title when he releases it to be equal to the actual sales amount. It was only questioned once by the privately run DOL I generally go to (there are far more privately run ones in Washington than State run ones). They sent me off with a form to have the buyer and me both sign that the sales number was correct...then they accepted the number.
Bob, that's not how it has worked for me.
(1) If the state tax book valuation is very very approximately correct for a number 3- condition car. So, for many collectors, this is more than fair
(2) Every old car that I've bought has been just under the state's book valuation (as stated on my bill of sale). Sometimes I have to pay a thousand more for the owners manual
(3) Yes, that book value is used no matter how little you paid for it. That's pretty unfair. However, MA has a rule that if you paid sales tax in another state and the car was then registered to you in that other state, then you don't pay in MA. I bought a car once in Kentucky, and paid something like $300 tax for a 30 day plate. When I submitted that to the MA RMV, they said, no tax due as it was classified as an out of state transfer into MA. Not all states will do it like Kentucky ...
There's a reason the big time car collectors I know live mostly up in New Hampshire (no sales tax), and why so many big dollar classics in MA are registered in Montana.
John
And a big reason you see so mamy Montana plates in CA is they can’t be registered here as they were grey market imports and owners use a Montana LLC to skirt the rules and avoid paying sales tax (which averages 8%).
I was referring to daily drivers, so far here, the tax for a classic cars has been based on my sales receipt. I have no idea what will exist when I register the E9 which was 9K when I bought it.
This brings up an interesting point. When you buy a classic to restore, do you wait to register it like I am doing? I knew it would be 3 or 4 years before it was road worthy. The price of a classic can vary widely over such a time period. Question is if the states adjust that quickly. Perhaps with the rise in cost of an E9, I would have been better off registering it when I bought it , paid tax on 9K and paid 60 bucks a year to keep it registered. Maybe now, the initial registration cost will exceed that 9K tax plus 4 years of registration. Kind like timing the stock market ....which never works.
This brings up an interesting point. When you buy a classic to restore, do you wait to register it like I am doing? I knew it would be 3 or 4 years before it was road worthy. The price of a classic can vary widely over such a time period. Question is if the states adjust that quickly. Perhaps with the rise in cost of an E9, I would have been better off registering it when I bought it , paid tax on 9K and paid 60 bucks a year to keep it registered. Maybe now, the initial registration cost will exceed that 9K tax plus 4 years of registration. Kind like timing the stock market ....which never works.
Bob,
I bought my current DD out of state. I left it at the dealer, and flew out to pick it up about two months later. Upon arrival in MA, I took it (with the temporary out of state plates), to our RMV. They looked at the date on the sales contract, and charged me a penalty because I had not registered it within the allowed 30 day grace period. I asked if this would apply to a car bought in Europe, and was told it doesn’t matter.
Good luck with the bureaucrats.
John
I bought my current DD out of state. I left it at the dealer, and flew out to pick it up about two months later. Upon arrival in MA, I took it (with the temporary out of state plates), to our RMV. They looked at the date on the sales contract, and charged me a penalty because I had not registered it within the allowed 30 day grace period. I asked if this would apply to a car bought in Europe, and was told it doesn’t matter.
Good luck with the bureaucrats.
John
A car pal in the UK just sent me a funny story.
He said the price of petrol in the UK is mostly tax. And when you buy gas they charge you VAT.His complaint is paying VAT on Tax is double taxation and invalidates the notion that its a VALUE ADD TAX since the first tax doesn’t add value to the gas.
It’s kinda nuts, right? He mentions how lucky we are in America...
John
He said the price of petrol in the UK is mostly tax. And when you buy gas they charge you VAT.His complaint is paying VAT on Tax is double taxation and invalidates the notion that its a VALUE ADD TAX since the first tax doesn’t add value to the gas.
It’s kinda nuts, right? He mentions how lucky we are in America...
John