Essay : Importing classics: Now’s the time?
With the advent of international trading, the world has never seemed so small. And yet, few people take time to import a classic into the UK. But it needn’t be that way.
Keith Adams explains how it’s done, makes some suggestions, and starts dreaming.
Importing a classic: you know you want to
WHEN Peter Doughty imported his 1993 MG RV8 from Japan, he found the process of getting it to the UK was the easy part of what proved to be a long and frustrating wait for his car. Because the laws governing the importation and taxation of classics proves to be a process confusing enough to be worthy of the civil service’s finest rule makers, Peter not only ended up paying out considerably more money than he first anticipated, but he suffered a frustrating wait before he could pick up the car from Southampton docks – because of Customs and Excise procedures.
Peter, a financial consultant from New Milton, near Bournemouth, ended up waiting rather a long time for his car to materialise – and his costs were higher than anticipated. ‘I didn’t quite appreciate the potential delays until they occurred – and no one prepared me for this’. Also, the unexpectedly high import bill, down to Customs and Excise’s insistence the car was not one of ‘Classic and Historic’ significance, didn’t sweeten the experience. Peter said: ‘There was some debate about whether the 10 per cent import duty should be paid on MG RV8s, as they are original UK built cars that have been exported. I think the letter of the law would imply the duty is not payable. However, I was advised that Customs and Excise operate a certain amount of local discretion, and in that situation you can’t argue.’
The best thing to do is ensure you do your research beforehand…
You know you want it…
This is an important consideration to take account of when thinking about bringing a classic car into the UK. Seduced by the prospect of owning a rust-free example of a classic car generally ravaged by the British climate, importation can often seem like a very tempting prospect – and one many PC readers consider regularly. Judging by the number of Simcas, Monicas, DKWs and other oddities out there on foreign soil, there’s a rich seam of classics to be tapped into; wouldn’t it be nice to bring them all home.
Most people tend to look at Europe for their classic car fixes, and warm, dry areas such as Greece and the Mediterranean islands are a plentiful source of cheap, rot-free classics. Classics are rapidly disappearing off the roads of Italy and Spain, though; EU-standard MoT-style tests are hoovering up all the interesting cars, and taking them out of the system.
Other good places to look are Southern Hemisphere right hand drive markets, such as New Zealand, Australia and South Africa. Strong historical links with the UK means these places are a rich source of classic British metal, and in many cases, you can pick up locally produced versions of some well-known cars. The climates in these markets are not always perfect for the sustained survival of classics, but on the whole, they are better than the UK – and active classic car clubs maintain a surprisingly high survival rate.
However, for most, idle thoughts of importing that interesting foreign classic remain just that – a few minutes’ enjoyable diversion, and very few of us actually decide to take the plunge and bring a classic in to the UK. However, before deciding not to import that classic you’ve always wanted, shouldn’t you know exactly what’s involved, rather than just assuming the worse?
If you do decide you’d like to import a car into the UK, you need to ascertain how much import duty it is going to be liable for. Your first port of call for more information is Customs and Excise, so give them a call on (020 7865 3000). There are a couple of major import permutations to choose from (EU and non-EU countries), so make sure you’re up to speed with what you’re liable for before you start totting up your costs.
Bringing it home…
Although it is always a good idea to start working out your import duties, VAT and registration costs, it’s always worth bearing in mind how you’re going to get your new classic home, and how much it’s likely to cost. Obviously, the most appealing way is to drive it back to the Calais, hop on a ferry and declare it when you arrive at Dover – and with the advent of inexpensive ferry website, it has never been cheaper to cross the channel – if you’re lucky, you’ll get a £25 ticket.
Insurance cover, local tax and a roadworthiness are essential for this, but your main insurer should be able to offer you temporary cover on a foreign registered car until you get it squared in the UK – check beforehand. Apart from anything else, this method of ‘transit’ can be a real adventure as well providing you with a great way of getting to know your new car…
If you’re bringing it in from further afield or simply don’t have the time for a classic driving holiday, you could choose a shipping agent to undertake the process for you. They will arrange shipping, and storage at the docks – and in some cases liaise directly with the authorities.
A popular and reasonably inexpensive way to get it home is roll-on roll-off shipping – basically your classic will sit on the deck or in the hold of a cargo ship, and gently steam across the world. Obviously, your car needs four wheels and an engine for this option – and costs will be kept down if the car runs. Also be aware that the car could get damaged in transit, or bits of it go missing…
A more secure method – and the recommended way if the car is valuable – is container shipping. You rent a container (the kind you see on the back of heavy goods trucks across the world) through a shipping company and get them to put your car inside. If you’re bringing back parts or anything else, you can place them in the box, too… It’s more expensive than Ro-Ro, but ultimately a preferable method, you can afford it.
It’s a safe method, but not infallible. One importer told us: “I bring cars over from California in containers but sometimes they still get damaged – so it isn’t an entirely safe method. I’ve also been told about people who’ve left parts in their cars but found they’d gone missing when the arrived in the UK.”
Either way, shipping is not a quick process – with potential hold-ups in the ports being a particular point of concern. Peter recalled: “The car was in dock at Japan for approximately 45 days, and then at the UK end for 5-10 days. It sat with my Agent for ages, due to various admin errors, including one by Rover in sending out the correct CoC (Certificate of Conformity)”
If you’re in a particular rush, and are flush with cash, you could always bring your classic car home via airfreight…
Paying your dues
If you’re importing a car from outside the European Union (EU), you will need to pay a duty of 10 per cent on the car’s value, plus shipping costs. If the car you’re looking to buy cost you £5000 and shipping a further £1000 on top of that, then you’ll be liable for 10 per cent duty on £6000. On top that, you will pay 15 per cent VAT (that will rise to 17.5 per cent in 2010) and a customs handling fee of £50, so the total costs for your import will be £6600 +VAT, plus the customs fee – £7805 (at 2010 rates). Remember that many other countries have higher rates of VAT than the UK, so try and defer that payment until you get back home.
If you’re looking at a car from within in the EU, the 10 per cent duty will be waived but it will be up to you to prove the car’s authenticity with a manufacturer’s CoC certificate, a heritage certificate or proof from a ratified owners’ or enthusiasts’ club. There will be 17.5 per cent VAT and the £50 customs fee on top of the car’s purchase price, plus shipping.
Once the car is in the UK, you’ll need to get it through Customs and Excise – and although this is one of the more simple aspects of importation, make sure you get it right. You’ll need the foreign registration document and any other papers you have for the vehicle. If they’re happy with the documentation, you’ll be presented with your bill for the import duty. Most shipping agents will complete this process for you as part of their service, but do check first.If it is possible to convince Customs and Excise that the car is of significant historical interest, it’s more than 50 years old, or is one of a kind (attaining what’s known as 9705 status), then that Classic and Historic VAT rate of five per cent will kick in, and the whole operation will become financially more appealing.
However, since May 2005, 9705 status is now almost impossible to achieve for vehicles, and this change of ruling is also been backdated to all EC returned vehicle imports since January 2004. As Peter’s MG is far from unique (2000 were built), and is considerably younger than 50, he couldn’t exploit this oft-quoted classic car loophole.
One often forgotten factor to consider when totting up the potential costs is storage at the docks once your car arrives in the UK. Your shipping company might not tell you this up front, they can charge you handsomely for looking after your car at the port – so don’t get stung. Our importer told us: “On one occasion, my shipping agent in the UK said he’d let me know when my car cleared customs – he didn’t. He rang me to say it was ready to be collected as soon as I’d paid their handling fee and the duties – and from the following day, I’d have to start paying a storage fee until I collected it.”
So make sure you get a clear answer on this before you agree to go with a particular shipping agent.
Making it legal for the road
Now you’ve paid your duties and got it through Customs and Excise, it’s down to you to make sure your new classic is legal to use on British roads. A vehicle imported into the UK must be registered and licensed as soon as possible after it arrives here. The vehicle should not be used or kept on public roads until the licensing and registration formalities have been completed – so make sure it’s transported by trailer, and garaged. Don’t be tempted to drive around on overseas registration plates – the penalties for doing so are not light.
The vehicle may well need to have a Single Vehicle Application (SVA) certificate (usually when the car was never originally sold in the UK and it’s under 10-years old), or have an MoT in order to be registered, but your Driver and Vehicle Licensing Agency (DVLA) local office will be able to help you out with that in order to remain legal.
For the vast majority of classics, there will be no need for type approval or SVA, and all you will require in terms of vehicle testing is a current MOT certificate in order to get registered. You will also need the foreign registration document and any other papers you have for the vehicle, customs clearance form, a valid certificate of insurance issued by a member of the UK Motor Insurance Bureau, and the payment for the tax disc…
If you have all these, get all your paperwork is completed, and the application accepted, two to three days later, you’ll receive your new tax disc and a UK registration document shortly afterwards. Peter recalled: “Registration is a fairly straightforward process – certainly with the hindsight of having done it now. You do need to be organised with all the forms and paperwork.”
Getting it insured
Most classic car insurers treat imported cars in exactly the same way as those originally sold in the UK. There can be a premium for left hand drive vehicles, or those, which weren’t sold over here – but on the whole the situation is a lot less complex than it used to be. Emma Bicknell, a marketing manager for Classic car insurers, Footman James, told us: “We do not treat an imported classic any differently to any other classic if it is classed as a ‘parallel import’ – one that was originally sold in the UK.”
The only major consideration is insurance while the car is in transit. If you’re driving it from the EU, that’s not normally a problem – the comprehensive policy on your family motor will cover you as long as you inform your insurers beforehand.
If the car is being shipped over, make sure the shipping company offers enough insurance to cover your vehicle in the event of a possible total loss. It isn’t always a straightforward process, though. “Once it’s in the UK, Getting Insurance for a car without a registration number or tax can be tricky! You need the chassis number. They are even less happy when you say you need to drive it like this for a DVLA Inspection”, Peter said.
There are a few complications to consider when purchasing a car overseas. Certainly, buying in the EU is a lot more simple than it used to be, and besides getting it MoT’d, covering your VAT payments, and getting it registered, there’s little to worry about these days. If you’re lucky, you might even get a nice driving holiday out of the experience.
Buying from further afield is a bit more complex (if you don’t entrust a shipping agent to handle the entire process for you), and a lot more costly, but with the advent of the Internet, and easy global communications (as well as payment), there has never been a better time to buy a car from the other side of the world.
It’ll never be as easy as popping down to your local classic car dealer, but the results can be very rewarding indeed – and after all the had work and research you put into the whole operation, the end product – a nice shiny classic car in your drive – will be all the more rewarding. Steve Shores, a consultant at Kensington Shipping – a regular importer of cars from all over the world – told Practical Classics: “Oh yes, importing your car is a very worthwhile experience. We don’t go out of our way to talk people into going down this route, but once people have decided to take the plunge, we will help them all we can. Importing your classic is certainly a way of obtaining the car of your dreams – and it’s a whole lot less complex than many people believe.”
You do need to do your homework, though, and choose your shipping agent, seller, and car very carefully indeed. If you can, get a trusted third party to check out any car you’re considering buying. Follow these basic rules, and do your sums beforehand to avoid unpleasant surprises later, and importing your classic can work out very well for you…
Peter certainly thinks the experience positive, even if there were times when delays frustrated him: “It was definitely worth the effort, otherwise I couldn’t have afforded to buy the RV8 – my dream car. It would have cost at least £1500 more from the UK, but more likely, quite a bit more than that. Of course with a UK dealer you get certain assurances in theory and more peace of mind. Plus you get it a lot quicker – but the waiting simply made the moment I picked up the car all the sweeter.”