Exporting Cars to the UK Safely

A Complete Guide to Importing a Car to the UK: Costs, Customs & Compliance

Importing a car into the United Kingdom can be an excellent way to acquire a unique vehicle or secure a great deal from abroad. However, the process is governed by strict regulations from HM Revenue and Customs (HMRC) and the Driver and Vehicle Licensing Agency (DVLA). Navigating these rules incorrectly can lead to significant delays, fines, and unexpected costs.

At Ship Cars Ltd, we specialise in guiding clients through the entire import process. This guide provides a definitive, step-by-step overview of what to expect, with a clear focus on the financial and administrative responsibilities involved roll on/roll off.

Part 1: The Core Financial Components of Importing a Car

Understanding the costs involved is the most critical part of planning your import. The price of the car itself is only the beginning.

1. Port Charges and Handling Fees

These are the fees for processing your vehicle at the UK port of entry (e.g., Southampton, Portbury, London Gateway).

• Port Handling Fee: Covers the cost of discharging the vehicle from the vessel, moving it to a secure holding area, and handling documentation.
• Customs Presentation Fee: The port’s charge for presenting your vehicle and its documents to Border Force for inspection and clearance.
• Storage Fees (Demurrage): This is a critical cost to avoid. If your vehicle is not cleared through customs promptly, the port will charge daily storage fees. Efficient documentation is key to preventing this.

2. Customs Clearance

This is the official process of declaring your vehicle to HMRC and securing its release. This is a legal requirement for all permanent imports container services.

• The Role of a Customs Agent: While you can theoretically do this yourself, it is highly recommended to use a specialist customs agent (like our partners at Ship Cars Ltd). They will:
  • Prepare and submit the correct import declaration (a C88 Single Administrative Document).
  • Calculate the correct VAT and Duty payable.
  • Liaise with Border Force on your behalf.
  • Secure the vehicle’s release from the port.
• Customs Clearance Service Fee: This is the fee charged by the agent for their expertise and service. It is separate from the taxes and duties you pay to HMRC.

3. UK VAT (Value Added Tax)

VAT is payable on most vehicles being permanently imported into the UK.

• Current Rate: The standard rate is 20%.
• Calculation Base: VAT is calculated on the CIF Value of the vehicle.
  • Cost: The price you paid for the vehicle.
  • Insurance: The cost of insuring the vehicle during shipment.
  • Freight: The cost of shipping the vehicle to the UK.
• Example: If you bought a car for £15,000, with £800 for shipping and £200 for insurance, the CIF value is £16,000. VAT would be 20% of £16,000 = £3,200.

4. Import Duty

Whether you pay duty depends on the vehicle’s origin.

• Rate: The standard rate for cars is 10%.
• Calculation Base: Duty is calculated on the Cost, Insurance, and Freight (CIF) value, before VAT is added.
• Rules of Origin:
  • From the EU: No Import Duty is payable due to the UK-EU Trade and Cooperation Agreement, provided you have the correct proof of origin.
  • From Other Countries: 10% Import Duty is typically payable on vehicles from countries like the USA, Japan, UAE, etc., unless a specific trade agreement states otherwise.

Summary of Tax and Duty Calculation

Example Calculation for a £20,000 car from Japan (CIF Value):

1. Import Duty: 10% of £20,000 = £2,000
2. VAT: 20% of (£20,000 + £2,000 Duty) = 20% of £22,000 = £4,400
3. Total Tax & Duty Payable: £6,400

Part 2: The Step-by-Step Import Process

Step 1: Pre-Shipment Preparation

• Research Vehicle Eligibility: Ensure the car can be registered in the UK. Check for any restrictions.
• Gather Documents: You will need the vehicle’s original title, purchase invoice, and any foreign registration documents.
• Notify HMRC: Your customs agent will do this by submitting an import declaration (C88) when the vehicle arrives deliver your car by transporter.

Step 2: Shipping and Arrival

• Your vehicle is shipped via RORO or container.
• Upon arrival at the UK port, it is held in a customs-approved area.

Step 3: Customs Clearance and Payment

• Your customs agent submits the full import declaration to HMRC.
• HMRC calculates the VAT and Duty owed.
• You (or your agent on your behalf) must pay the full amount to HMRC. The vehicle cannot be released until this payment is confirmed.

Step 4: DVLA Registration and IVA

Once the car is released from customs, you must make it legal for UK roads.

• IVA (Individual Vehicle Approval) Test: Vehicles newer than 10 years will need to pass an IVA test. This checks the vehicle meets UK safety and environmental standards. Modifications (e.g., to headlights, speedometer) are often required.
• DVLA Registration:
  • Submit the IVA certificate (if applicable), proof of UK insurance, the customs clearance document (NOVA), the foreign title, and a completed V55/2 application form.
  • Pay the vehicle’s first-year road tax and the DVLA registration fee.
  • The DVLA will then issue a UK V5C logbook and a registration number.

Part 3: Key Considerations and Potential Pitfalls

The NOVA System

• All imported vehicles must be notified to HMRC’s Notification of Vehicle Arrivals (NOVA) system.
• This is typically done by your customs agent as part of the clearance process. You will need the NOVA reference number for DVLA registration.

VAT Exceptions and Reliefs

VAT is not always payable. Key exceptions include:

• Transfer of Residence (ToR): If you are moving your permanent home to the UK and have owned and used the vehicle abroad for at least 6 months reduced VAT for your vehicle import.
• Personal Belongings Relief (PBR): For returning UK residents who have been living abroad for at least 12 months.
• Temporary Imports: If the vehicle will be in the UK for less than 6 months.
• VAT-Exempt Vehicles: e.g., classic cars over 30 years old.

Applying for relief is complex and requires evidence. We strongly recommend seeking professional advice.

Total Landed Cost

When budgeting, you must consider the total landed cost: Purchase Price + Shipping + Insurance + Port Fees + Customs Agent Fees + Import Duty + VAT + IVA Test & Modifications + DVLA Fees + Road Tax

Authority Link: GOV.UK – Importing vehicles into the UK

Your Pre-Import Checklist

• Researched the car’s eligibility for UK registration.
• Understood the total potential costs (see calculation table above).
• Budgeted for VAT and potential Import Duty.
• Gathered all original vehicle documents (Title, Invoice).
• Arranged for a professional customs agent to handle clearance.
• Researched the IVA test requirements for your specific vehicle.
• Investigated if you qualify for any VAT relief (e.g., Transfer of Residence).

Let Ship Cars Ltd Simplify Your Car Import

The complexity of UK car import regulations makes professional assistance invaluable. Our service includes:

• Door-to-Door Shipping from the country of origin.
• Expert Customs Clearance through our UK-based partners.
• Transparent Cost Breakdowns with no hidden fees.
• Guidance on IVA and DVLA registration.

Don’t risk costly delays or compliance issues. Contact Ship Cars Ltd today for a comprehensive quote and let us manage your vehicle’s smooth arrival into the UK.