CAR TAXES

The new car taxes were agreed on the 20th November 2003 and are now in force.The government has stated that the new system will not change for at least the next two years.

The new tax is a consumer tax, as is VAT, not a customs duty!

The new tax system applies to all new cars and second-hand cars that are imported into Cyprus from outside the EU or inside the EU if they are outside the conditions laid out in 'Vehicle Importation Fees'.

To work out the tax you will pay, multiply the engine size of the vehicle (cc) by the Cyrpus pound rate in the engine category into which it falls. Add this to the basic cost of the vehicle. Don't forget registration fees (please see table 1) and VAT at 15%

Vehicle Importation Fees'

Importing a car from the EU

Customs Transitional Provisions

The information below may be of use for those of you changing from 'V' plate to local plates and those wishing to pay the duty so that you may work.

For the vehicles mentioned below, the excise duty will be calculated either on the basis of the customs provisions applicable until 23 November 2003,
• i.e. on the basis of their historic value, (This can only be calculated by Customs )
or
• on the basis of the cubic capacity of their engine
The lesser of the two amounts will be payable:

The option to choose applies to vehicles that fit the criteria below:

For brand new off-road vehicles (4X4), which had been imported and were not cleared until 24 November 2003.
This transitional period will apply until 23 November 2004.

For used vehicles, which had been imported and were not cleared until 24 November 2003, or used vehicles which have been imported by 31 December 2003, as long as the Director of Customs is satisfied that their shipment had been arranged before 24 November 2003, or have been imported by 10 January 2004 but their delayed arrival is not due to acts or omissions of the importer.
This transitional period will apply until 23 November 2004.

For vehicles which have been cleared duty free or partly duty free or for which a reduction in duty payment has been granted in the form of drawback of duties, or which are under the temporary importation regime.
This transitional period will apply until 31 December 2004.

For vehicles, which until 24 November 2003 were cleared under another tariff heading and as a result of modifications made on them, they are classified under tariff heading 8703, under which saloon cars are classified (e.g. a van is converted into a saloon car).

See also examples of how to calculate excise duty.

Examples - how to calculate excise duty

The following examples have been supplied by Customs and will help you to understand better how excise duty on vehicles is calculated. In all examples it is assumed that the importer has proved EU Community status of the vehicles.

Example 1:

A used saloon vehicle is 9 months old at the time of its transfer in to Cyprus from the United Kingdom on the 15 May 2004.
The cubic capacity of its engine is 1789 cc and the carbon dioxide emissions are 180 gr/km.
The excise duty payable is calculated as follows:
1789 x 2,70 Cyprus pounds = ?4.830
This amount is reduced by 15% because of its age, i.e.:
4.830 Cyprus pounds– (4.830 Cyprus pounds x 15%) = 4106 Cyprus pounds
Additional excise duty 1789 x 0,01 Cyprus pounds = 18 Cyprus pounds
Total excise duty payable 4.106 Cyprus pounds + 18 Cyprus pounds= 4.124 Cyprus pounds

Example 2:

A used saloon vehicle is 6 years old at the time of its transfer in Cyprus from the Germany on 2 June 2004. The cubic capacity of its engine is 2499 cc.
The excise duty payable is calculated as follows:
2499 x 5,50 Cyprus pounds = 13.745 Cyprus pounds
This amount is increased by 25% because of its age, i.e.:
(13.745 Cyprus pounds x 25%) = 3.436 Cyprus pounds
No certificate for the carbon dioxide emissions has been produced and therefore the excise duty is increased by 10%, i.e. {(13.745 Cyprus pounds + 3.436 Cyprus pounds )} x 10%) = 1.718 Cyprus pounds
Additional excise duty 2499 x 0,01 Cyprus pounds = 25 Cyprus pounds
Total excise duty payable: 13.745 Cyprus pounds + 3.436 Cyprus pounds + 1.718 Cyprus pounds + 25 Cyprus pounds = 18.924 Cyprus pounds

Example 3:

A brand new van having an engine cubic capacity of 2150 cc was purchased from France for 5.000 Cyprus pounds. The transportation cost to Cyprus and the relevant insurance during the voyage was 500 Cyprus pounds.
The excise duty payable is calculated as follows:
2150 x 0,75 Cyprus pounds = 1.613 Cyprus pounds
Additional excise duty 2150 x 0,01 Cyprus pounds = 29 Cyprus pounds
Total excise duty payable: 1.613 Cyprus pounds + 22 Cyprus pounds = 1.635 Cyprus pounds
VAT is also payable on this van, which is calculated as follows:
(Purchase price + transportation costs and insurance + excise duty) X 15% = (5.000 Cyprus pounds + 500 Cyprus pounds + 1.635 Cyprus pounds) x 15% = 920 Cyprus pounds

Road Tax is due at the beginning of each year and is charged according to vehicle engine size, unladen weight and whether a petrol or diesel.

To work out the rate for your vehicle, multiply the engine size of the vehicle (cc) by the Cyprus pounds rate in the engine category into which it falls. It will be in the range shown.

Transferring ownership of a vehicle and registering it normally costs the buyer 10,00 Cyprus pounds.
When a third party is involved, such as a bank or guarantor, the cost is 16.00 Cyprus pounds.

Road Tax is due at the beginning of each year and is charged according to vehicle engine size, unladen weight and whether a petrol or diesel.

To work out the rate for your vehicle, multiply the engine size of the vehicle (cc) by the Cyprus pounds rate in the engine category into which it falls. It will be in the range shown.

Transferring ownership of a vehicle and registering it normally costs the buyer 10,00 Cyprus pounds.
When a third party is involved, such as a bank or guarantor, the cost is 16.00 Cyprus pounds. 

Registration fees For those of you who wish to buy a new car, or those of you changing from V plate to local plates, the new registration fees may be of interest.

Engine Capacity (cc)	Discount	Up to 1450	1451  - 1650	1651  - 2050	2051  - 2250	2251  - 2650	2651 and more
Cyprus pounds per cc		0.1	0.15	0.25	0.3	0.6	0.6
-			Cyprus pounds	Cyprus pounds	Cyprus pounds	Cyprus pounds	Cyprus pounds
Private Car	0%	25 - 145	218 - 248	413 - 513	615 - 675	1351 - 1590	1591 -
Van	0%	25 - 145	218 - 248	350	350	350	350
Double Cab	55%	25 - 102	152 - 173	289 - 350	350	350	350

To work out the rate for your vehicle, multiply the engine size of the vehicle (cc) by the Cyprus pound rate in the engine category into which it falls. It will be in the range shown.

Road Tax is due at the beginning of each year and is charged according to vehicle engine size, unladen weight and whether a petrol or diesel.

To work out the rate for your vehicle, multiply the engine size of the vehicle (cc) by the Cyprus pounds rate in the engine category into which it falls. It will be in the range shown.

Transferring ownership of a vehicle and registering it normally costs the buyer 10,00 Cyprus pounds.
When a third party is involved, such as a bank or guarantor, the cost is 16.00 Cyprus pounds.

Importing a car outside the EU

The new tax, registration fees and VAT will have to be paid unless you are entitled to a duty free vehicle.
There are however discounts on the tax. If the vehicle is up to one year old on importation there is a discount on the taxes of 15%, over one year and up to three 20%.

If the vehicle is over five years old there is an addition to the tax of 25%. This is to discourage the importation of older vehicles. There are also small discounts for those vehicles that conform to certain exhaust emission criteria.

You may contact Department of Transport for further details on 22-807121.

Buying a duty free car

Proof of EU status.

Goods in free circulation in the EU can move from one member state to the another without payment of further Customs import duty. To be exempt from paying further import duty in Cyprus, proof of Community status of the goods must be provided.
If you are transferring a car for private use to Cyprus from another member state, you may prove its Community status by producing:

1. In the case of a brand new or used vehicle, a document called a T2L or T2L. which is obtainable from the previous Member States:-

• Customs Service
• Vehicle supplier or
• Shipper. OR

2. In the case of used vehicles only, the number plates and the vehicle registration document issued by the vehicle registration authority the member state.

Failure to provide proof will make you liable to pay the import duty in addition to the excise duty and VAT.

• Saloon type motor vehicles
• Station-wagons
• Jeep (4 x 4) type vehicles
• Mini-buses capable of carrying up to nine persons.

You are not entitled to apply for motorcycles or other types of motor vehicles.

Relief is granted on the whole amount of excise duty for one vehicle per person.

If you have claimed relief on a new vehicle, you will have to pay VAT. If however the vehicle is used and VAT on it has been paid in another member state of the EU and has not been refunded because of its transfer from that state, you will not have to pay VAT.

Relief will be granted if:

• you have taken up residence in Cyprus
• you do not exercise a profession or occupation of any sort
• none of the members of your family shall be engaged in any type of work in Cyprus
• the vehicle shall be transferred to Cyprus within a reasonable time period from the approval of the application.

How to apply for relief.

A claim for relief must be made in person by you, by completing Application for relief on motor vehicles imported or acquired by aliens who live permanently in Cyprus Form P17, on arrival in Cyprus.
The claim must be submitted to the Relief Section of Customs Headquarters in Nicosia and be accompanied by the following evidence:

• passports of yourself and of your spouse
• evidence of the place of stay (purchase or lease agreement of a house in Cyprus, permission to purchase immovable property within Cyprus)
• certificate of registration as an alien
• residence permit from the Immigration Officer
• your driving licence (of Cyprus or of the country you are coming from)
• documentary evidence that you are financially independent and that you receive an income from abroad (e.g. bank statements, pension payment certificates, etc.)

You should take copies of all the above documents.

If your application for relief is granted:

You will have to complete form SAD. If you cannot complete it on your own, you may use the services of a clearing agent. You may produce your SAD at any Regional Customs Office. Customs will issue Form C72A and a copy will be give to you. The vehicle must be then produced, together with Form C72A and other documents relating to your vehicle, to the Department of Road Transport for inspection and registration purposes.

Conditions after importation.

• You shall not sell, lend, pledge, rent, export, transfer or dispose off it otherwise without the prior approval of the Director of Customs.
• Persons entitled to drive the vehicle, in addition to you, are your spouse and dependants.
• The duty-free replacement of the vehicle is permitted on condition that you continue to reside in Cyprus and you have disposed off the duty-free vehicle previously placed in free circulation and use under relief.
• If you decide to dispose off the vehicle on which relief was granted you will be required to pay the excise duty.

Any infringement of the conditions is unlawful and carries severe penalties.

Exemption of Excise Duties on transfer of your normal residence.

• is part of your personal property;
• is being brought permanently into the Republic by you
• has been in your possession and use for a period of a minimum of six months in the place of your previous normal residence;
• was acquired by you according to the general conditions of taxation in force in the domestic market of the member state
• VAT and duties have been paid and not refunded.
• you have, during the last 12 continuous months, been resident outside the Republic.

If you fail to produce the required evidence the application may be refused.

You are required to declare it to the nearest Customs Station within 24 hours from the date of its arrival.

If a public holiday or weekend follows the date of arrival, you must make the declaration on the first working day after the expiration of the 24 hours deadline.

In order not to be deprived of your vehicle until you make an application for relief and receive an answer, you may be allowed to drive the vehicle temporarily under Form C.104. A copy of Form C.104 will be given to you by Customs and you must keep it in the vehicle all the time and produce it to a Customs or Police Officer if so requested.

You may submit your application for relief to any Customs Office or to Customs Headquarters. If you get a positive answer, the procedure is not terminated there. You will have to complete form SAD. If you cannot complete it on your own, you may use the services of a clearing agent. You may submit your SAD at any Regional Customs Office, accompanied by Form C.104, which will be kept by Customs. You will not pay excise duty or VAT.

Conditions after importation if relief is approved.

• The vehicle shall not be hired out
• given as security
• sold or otherwise disposed of without the approval of the Director of Customs and Excise Department.

If relief is not approved you must

• pay the excise duty (and VAT if applicable.)
• place it in a customs warehouse
• send it to another member state of the EU; or
• export it to a third country. In order to pay the excise duty, you will have to complete form SAD. If you cannot complete it on your own, you may use the services of a customs clearing agent.

Other non Customs expenses to be paid:

Registration Fees

Circulation Licence (Road Tax)

Insurance  


DORT Vehicle Test (MOT)v  
In Cyprus vehicles over 4 years old are subject to Department Of Transport (DORT) test - analogous to the UK MOT. The MOT test is a 'basic' check on the car's mechanical equipment, including brakes, lights and steering etc. These are checked to ensure the vehicle is roadworthy.

If your vehicle is properly registered and the Department of Transport has your current address, you will receive a form from them informing you that the test is due. You go along to your local Co Op branch with the form and the fee, currently 25 Cyprus pounds , and get a receipt. Then take the form and receipt to a local garage authorised to carry out the test. There are a number of them in the local area and they usually advertise the fact.

If the vehicle passes, a form is issued. Send this to the Department of Transport.

A disc similar to the tax disc is sent to you. It should be displayed on the front windscreen next to your tax disc. If you don't receive a notification that the test is due, you should go directly to the Co Op and go through the same procedure. Non receipt of the reminder will not let you off the hook should it come to a prosecution.

The DORT is currently valid for two years. Most of the MOT testing stations will carry out a pre-DORT check at a nominal price and let you know what work has to be done in order to pass
If your vehicle is fitted with a speedometer marked in miles per hour (MPH), it will have to be replaced by one marked in kilometers per hour (KPH).

Information

For more information you may write to the following address:

The Director
Department of Customs and Excise
Corner M. Karaoli& Gr. Afxentiou,
1096, Nicosia Fax no 22302031
E-mail:headquarters@customs.mof.gov.cy

For oral inquiries you may call any of the following telephone numbers of the Reliefs Section at Customs Headquarters: 22601706 or 22601709

Buying and selling a duty paid car

Registration fees are to be paid only.

Selling a duty free car

When selling a duty free car Excise Duties have to be paid.
If the car is on V plates - Registration Fees and VAT @ 15% will also have to be paid.

If the vehicle was imported prior to 2004 see Customs Transitional Provisions above.
This one is a really good web-site which can be used a link to provide useful information about people who are planning to leave in Cyprus or buy a car in Cyprus.
http://cyprus.angloinfo.com/countries/cyprus/contacts9.asp

In regards the FINANCING of cars can you have a look on the following link it might be a good idea to implement a similar for the client's web-site.
http://www.samsmotors.com/navigate.pl?section=services&subs=financeform.html