In order to avoid double payment of value-added tax (VAT) when buying a car abroad, including in Europe, you need to formalize the purchase properly with the seller. Most often, cars in Europe are bought in Germany, Poland and Lithuania. The basic requirements for VAT refund when buying a car:
- The seller must be a VAT payer in the country in which he operates
- The buyer must be not a resident of this country.
So, if in the ad you found a car for which the cost consists of two prices of NETTO and BRUTTO, then you can count on the price that is lower. Otherwise, if there is only a BRUTTO price, it will not be possible to return the VAT, since the private person is not the seller of the car sales activity, but only intends to get rid of his own car.
Each country may have its own rules regarding the re-registration of the car when buying or selling, but the general stages for the return of VAT are the same all over the world. On the example of the most popular countries among motorists Germany, Poland and Lithuania general rules apply. Here are the main ones:
- Carry out payment for the car in cash or without cash on the basis of a purchase agreement, an invoice, invoice or other document.
- Apply to the internal customs office in the area of the seller’s activities for processing the export declaration. The local customs broker will help you to carry out all the formalities.
- Cross the border on a special lane for trucks and put a mark in the export declaration.
If you go through all these stages, then the seller in electronic form comes the message that the car has left its country and to pay value-added tax it is no longer required. There is a possibility that the buyer will make a mistake and not put a mark in the export documents at the border, then the seller must pay VAT for the car sold. That is why, for their safety, they require to leave a deposit in the amount of full or partial VAT, and after crossing the border they return cash or a card account.
Given that the scheme is already polished in the “guru” of carriers or intermediaries in terms of fitting cars from Europe (Germany, Poland, Lithuania) and returning to the seller for a deposit does not cause any problems, whereas for you to return to the seller may simply not be profitable . In this case, we can help to arrange the purchase of your car at the price of NETTO without additional payments and deposit. Our specialists can advise you.
Let’s sum up:
- VAT is returned by the seller from whom the car is purchased.
- Return VAT can only be purchased from a legal entity.
- Sellers private individuals do not return VAT.
- Buy cars without VAT can be both physical and legal entities registered in Ukraine.