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Importing a Car From Japan To The UK

May 25, 2024June 13th, 2024No Comments
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Are you considering importing a car from Japan to the UK? Japan is renowned for its high-quality vehicles and unique models that often aren’t available in the UK market. However, the process of importing a car from Japan can seem daunting to many. But fear not, as we’ve compiled a detailed guide based on accurate information from government sources to walk you through the entire process. This guide will cover:

  • Pros & Cons of importing a vehicle from Japan to the UK
  • How to notify HMRC within 14 Days of the Vehicle arriving
  • What the NOVA service is
  • What VAT and Import Duty are applicable
  • How to pass vehicle compliance with the IVA (Individual Vehicle Approval)
  • How to register and tax your imported vehicle.
  • How to get the best exchange rate when converting GBP to JPY

What are the Pros and Cons of Importing a car from Japan?

Before delving into the intricacies of importing vehicles, it’s essential to take a moment to consider the various factors involved and weigh the potential advantages and disadvantages. Importing a vehicle entails a series of steps and obligations, each with its own set of implications.

Pros:
  • Cost Savings: Despite shipping expenses, Japanese cars can often be cheaper than their UK equivalents.
  • Unique Models: Gain access to a variety of exotic and rare models not typically found in the UK.
  • Higher Quality: Japanese cars are renowned for their superior build quality and custom specifications.
  • Bypass Waiting Lists: Skip the queues for sought-after models, saving you time and hassle.
Cons:
  • Compliance Issues: Japanese cars may require modifications to meet UK safety and environmental standards, adding to the overall cost.
  • Tax and Duties: Importing entails additional expenses such as taxes and customs duties.
  • Paperwork and Hassle: Navigating through paperwork and regulations can be time-consuming and cumbersome.
  • Insurance Premiums: Imported vehicles may incur higher insurance premiums.
  • Maintenance Challenges: Repair, parts, and servicing for rarer models might be difficult to obtain.

Importing Vehicles to the UK from Japan

When permanently importing a vehicle into the UK from Japan, it’s crucial to inform HM Revenue and Customs (HMRC) within 14 days of its arrival. Failure to do so can result in fines. The method of notifying HMRC varies depending on whether you’re importing the vehicle to Great Britain (England, Scotland, and Wales) or to Northern Ireland, as well as your VAT registration status, whether you’re a VAT registered company, a non-VAT registered company, or a private individual.

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For VAT-registered Companies

For VAT-registered companies, informing HMRC about the imported vehicle involves using the Notification of Vehicle Arrivals (NOVA) service within 14 days of bringing the vehicle into the country. This can be done online, and for those unable to use the online service, a VAT NOVA1 form can be requested. If you are importing a large volume of vehicles, you can upload the vehicle details via a spreadsheet to the NOVA service.

For Non-VAT Registered Companies
Non-VAT registered companies or private individuals may have HMRC make a NOVA application on their behalf, but they must still submit an import declaration via email. Importers are also encouraged to contact the HMRC Personal Transport Unit for assistance in completing the NOVA application.

To complete the NOVA application process, you must provide HMRC with specific documents, including the C88/E2 customs documents, the invoice or bill of sale for the vehicle, and any official document confirming the Vehicle Identification Number (VIN) or chassis number. These documents are vital for adding the vehicle to the NOVA system, which is a prerequisite for registering it with the Driver and Vehicle Licensing Agency (DVLA). They should be emailed to [email protected] for processing.

Importers who previously owned the vehicle in the UK may be eligible for reduced import duty and VAT. To apply for this relief, they must submit a completed form C179B along with evidence of previous ownership and a copy of the current registration document from the country of export.

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VAT and Duty for Cars Imported from Japan

After completing the Nova application, it will then be processed. HM Revenue and Customs (HMRC) will inform you of the VAT and duty that must be paid before registering your vehicle. HMRC determines whether VAT or duty applies based on your vehicle import declaration. VAT is calculated on the total vehicle cost, including accessories, delivery, and any additional charges.

Duty is applicable to vehicles imported into England, Wales, and Scotland from outside the UK, or to Northern Ireland from outside the UK. The VAT is 20%, and the import duty, if applicable, is 10%. In some cases, there is no VAT or duty if you qualify for relief. For example, if you’re moving to the UK with your vehicle, if you’re returning an exported vehicle to the UK, or if you’re visiting the UK with your vehicle. However, it’s always best to double-check by contacting the HMRC helpline to verify the rates.

Why you imported it What and how you pay
You’re moving to the UK with your vehicle No VAT or duty if you qualify for relief
You’re returning an exported vehicle to the UK No VAT or duty if you qualify for relief
You’re visiting the UK or the EU with your vehicle No VAT or duty if it qualifies as a temporary import
Any other reason – if you’re not VAT-registered VAT and duty – pay HMRC at the UK border (your shipping company may do this for you)
Any other reason – if you’re VAT-registered VAT and duty – pay HMRC at the UK border (your shipping company may do this for you) and claim the VAT on your next VAT Return

Getting Vehicle Approval

As mentioned earlier in this article, cars imported from Japan to the UK must meet specific criteria for health, safety, and environmental reasons. Therefore, you will need to ensure your imported vehicle is approved before you can register it. Vehicle approval demonstrates compliance with environmental and safety regulations, and you’ll require proof of approval to complete the registration and taxation process. However, if your vehicle was first registered or manufactured over 10 years ago, it might be exempt from approval requirements. Be sure to check if your vehicle qualifies for an exemption.

Before proceeding with registration and taxation in the UK, undergoing Individual Vehicle Approval (IVA) is mandatory to ensure compliance with the aforementioned standards. The IVA scheme applies to single or small numbers of passenger cars, goods vehicles, buses, coaches, trailers, and special purpose vehicles. The approval process consists of two levels of inspection: basic and normal. Basic IVA entails visual inspection and tests, while normal IVA requires more detailed scrutiny along with documentary evidence.

Registering a Vehicle Imported from Japan

Now that you’ve successfully navigated through the necessary steps of importing a vehicle to the UK—such as notifying HMRC within 14 days of the vehicle’s arrival, completing the NOVA process, determining and paying the VAT and duty obligations, and passing the vehicle’s IVA compliance test—it’s time to proceed with the final steps: registering your vehicle and ensuring it’s properly taxed. With all the prerequisites fulfilled and compliance ensured, registering and taxing your vehicle marks the culmination of the importation journey, allowing you to legally operate your vehicle on UK roads. To accomplish this, you will need to use either Form V55/4 for new vehicles or Form V55/5 for used vehicles. Additionally, the DVLA may request further supporting documentation at this stage, such as identity documents or your driver’s license. Please note that this process can take up to 6 weeks.

 

How to get the Best Exchange Rate when Importing a car from Japan?

When importing a vehicle from Japan to the UK, one crucial consideration is managing currency conversion. As most transactions involve paying in Japanese Yen (JPY), converting GBP to JPY can significantly impact the overall cost of importing.

Using traditional banking channels for currency conversion may not always be the most cost-effective option. Banks often charge high fees and offer less competitive exchange rates, leading to increased costs for buyers.

Rutland FX can assist you by providing a more competitive rate than a bank would offer, along with quicker payments via the SWIFT network that are fully traceable and trackable by SWIFT GPI. To obtain a free currency quote, you can click here.

Still not sure?

If you are still unsure or have any further questions, please call us on 0203 026 0112 or request a callback to discuss your requirements.