If you want to invest your hard-earned cash in a new set of wheels, the options are almost endless. Here we investigate if it’s cheaper to import, self-build or simply buy a new car.
How much does it cost to import a car to the UK?
When you want to buy a new car it’s a good idea to shop around for the best deals and some of those can be found abroad.
New car imports from abroad come in two categories, parallel and grey imports. Parallel imports are vehicles brought into the UK from a country within the EU while grey imports are imported from outside the EU, often from Japan, the USA or other emerging markets.
If you plan to buy a new car abroad and then import, you can often secure a discount of as much as 50% off the price in some cases of the same car in the UK. However, importing a car can be confusing for the inexperienced and will incur a number of extra costs.
And once you get your new car back to Britain you may have to modify it depending on which country you decided to buy a new car from.
Modifications can include converting a left-hand drive to a right-hand drive and changing headlights and facia instruments, for example. Non-European vehicles imported to the UK will also need to undergo a safety standards test and this will be an additional fee.
When you buy a new car abroad you will need to decide whether you’re going to arrange the import yourself, or whether to use a UK vehicle importer which would mean far less work for you.
They will be able to deal with manufacturers from different countries without any language difficulties and deal with most of the red tape and paperwork including customs and shipping.
Will I have to pay tax when importing a car?
You will need to pay tax when importing a vehicle from abroad. Despite being able to buy from overseas at a cheaper rate, you may wish to take into account how much it will cost to not only ship the car, but the tax too.
The primary taxes you will need to pay are customs duty and Value Added Tax (VAT). If you are importing a vehicle from the EU this will generally be a 10% customs charge and 20% for VAT if there is no zero-tariff trade agreement.
If your vehicle is coming from the USA, the charges will be 10% for customs duty and 20% VAT.
These charges are calculated based on the car’s total cost, meaning the values of the vehicle, shipping costs and insurance fees, not just the price you initially pay for your new car. You will need to pay the taxes in order for customs to clear your new wheels.
The good news is paying your import VAT and customs duty is quick and easy through the online portal with HM Revenue and Customs (HMRC).
You will also have to factor in the cost of actually shipping your car from the point of purchase to the UK. The more remote location in which you decide to buy a new car, the more it will cost to get it home. The cheapest places to ship from are those closest to the UK across the Channel, such as France, Belgium and Holland.
The size of the car will also help determine the price of shipping with small and family saloons being cheaper to ship than vans and long wheelbase models.
Is it cheaper to import a car from Japan to the UK than other countries?
Japan has become one of the largest markets for importing cars to the UK. Like shopping in the USA or Europe, Japan can be cheaper than buying a new car in the UK, even the higher-spec versions of the vehicle you are looking to purchase.
In some cases you can buy the car through a company that specialises in shipping vehicles to the UK, which usually includes the transfer cost for an added fee, meaning you don’t have to worry about transportation.
Cars imported from Japan are still subject to customs duty and VAT, with the former charged at 10% and the latter at 20%.
Buy a new car to import: conclusion
You may save up to 50% on purchase price when you buy a new car abroad, but you will have to factor in shipping costs, import duty and up to 20% VAT.
Consider also a nominal £2,000 for necessary modifications, registration and licensing of your newly imported vehicle once it arrives in the UK.
It is also worth bearing in mind the car’s residual value. Unless it’s a classic car or collector’s piece, an imported car, especially one which has been modified, will probably be worth less than you expected when you come to resell it in the future.
How much does it cost to buy a new car?
How long is a piece of string? At the bottom end of the market you could pick up something like a Dacia Sandero for £13,795. It’s just about the cheapest brand new car on the market but the finish isn’t cheap because it comes with all the bells and bows you would expect on high end luxury cars.
The Dacia comprises parts manufactured by parent company Renault so you can be confident you’re not being sold a pup!
Other models at the budget end of the market include the Citroen C1 at a tad over £10,000 and the Kia Picanto which will cost under £14,000.
The questions to consider when buying a new car are, how many heads do you want to turn and how deep are your pockets?
Buy a new car: conclusion
Around two million people each year choose to buy a new car in the domestic marketplace, and two million people can’t be wrong.
It may not be the cheapest option, but it is the easiest option. And nowadays you can choose your own spec, selecting colour, interior finish, and the optional extras you desire to give your new wheels a little bit of individuality.
How much does it cost to build your own car?
The cost of building your own car varies hugely depending on what sort of kit car you go for. The popular Caterham Seven model range can set you back from around £28,990 to £38,490.
But of course, once you put that together you’ll be the proud owner of a very feisty sports car based on the Lotus-manufactured 7-series of kit cars built from 1957 until 1972.
You can spend less when you come to buy a new car to build from kit form, but you can also spend much, much more, as detailed in this guide to the world’s most expensive and impressive kit cars.
According to the company’s own website, it can take anywhere between 80 and 100 hours to build your own Caterham Seven, but unless you are a particularly experienced mechanical engineer you could probably double that time period and then some.
You will also need to invest in, or hire, a lot of equipment to do the job and may have to recruit specialists to undertake tasks that are beyond your skill-set.
Once the build is complete you will have to pay a fee to register your new car and undertake an Individual Vehicle Approval test costing £190-£285.
The great thing about building your own rather than deciding to buy a new car is that when something goes wrong or a part malfunctions, because you put it together in the first place, the chances are you will know how to fix it, so you won’t have to book a trip to the garage.
The flip side is that kit cars are lightweight vehicles not really designed for everyday use. They are summer weekend run-arounds so that means you will have to invest in an everyday car too.
Build your own car: conclusion
It will be a labour of love and can cost as much as a decent new car, but it will entail a heck of a lot of work. You will likely have to invest in an everyday car too so that could double your costs. However, going forward, you shouldn’t have too many repair bills for your kit-car.
So which is the best deal, self build, import or buy a new car?
It really does depend on what you are looking for but, generally speaking, because of the discounts available abroad, it will be more economical to buy a new car overseas and then import it.
But don’t forget those extra taxes you will have to fork out for and the red tape you will have to negotiate to bring in your new car and get it registered in this country.
Don’t forget your car insurance
You will have to get your new car insured too and whatever your chosen option, buy a new car, build your own, or buy abroad and import, you would be wise to go to a specialist broker such as Adrian Flux to get comprehensive peace of mind motor insurance.
Adrian Flux has access to a panel of more than 30 insurance providers and offers bespoke policies for: Standard cars, imported vehicles, kit cars, high performance cars and classic cars.
The best deals are usually available over the phone, so call 0800 369 8590 for a quick and easy quote or book a callback at a time that suits you.