Taxes When You Buy A Car
Taxes when you buy a Car
June 15, 2019
Buying a vehicle is no small matter. For most taxpayers, it’s one of the largest purchases they have to make, besides their home. It’s important, therefore to learn about the process and prepare for this large expense.
It’s not enough to know about the car itself and the price you can and should pay for it, but also for the taxes and other additional expenses that come with it. That will help you save as much as you can and get the best car for your money.
The first thing to do is to figure out your vehicle history so that you know what you’re getting yourself into. You should contact DVLA and get a few key data pieces before you start negotiating the price. Start with these and go from there:
When the current vehicle tax expires
The date on which it has been registered
- Engine size
- CO2 emissions
- The current vehicle tax rate
- When it’s MOT expires.
You can also use a similar online tool to find out is the vehicle insured at the moment and how long it will be.
Buy and register the car.
Once you buy the vehicle, you need to register it. There should be a contract signed between the buyer and the seller that states how much the car costs and how it can be recognized by the authorities. Once this is completed, you can register the vehicle.
The process for registering the car depends on is the car used or is it brand new. The tax you pay is much smaller on the new cars because the car becomes more dangerous for the environment as it grows older. You’ll need to find out the exact date when your car was manufactured to make sure you’re paying the right taxes.
MOT test is the test set up by the ministry of transportation that needs to be done every once in a while to make sure your vehicle is in order. The tests become more frequent as the vehicle gets older. It’s possible to register for MOT reminders and thus make sure you don’t miss a single one of them.
The reminder can come one month or two months before the due date. It’s up to you to choose. The fine for driving without MOT is £1.000, so you better be on time.
The car needs to insured in case you have an accident or suffer some damages. If you’re buying a used car, there’s a chance that you already have insurance that hasn’t yet expired and was paid by the previous owner. This is something you could check for online.
Once you’ve found out, do you have insurance, and once you’re sure that you don’t have a policy, you should purchase one. The policy should cover your vehicle in case you have an accident or in case you get hurt.
In the end, you’ll need to pay the taxes on your new vehicle. The tax you need to pay depends on how much fuel and what kind of fuel your vehicle will use. If it uses electricity, you won’t pay any tax since you don’t emit any gasses to the environment. New vehicles are also taxed less than the old ones.
HMRC provides you with a list that states how much you need to pay based on the type of engine you have and how much gasses it emits. The rates will also rise as your vehicle is getting older.
Who does all of this?
There’s quite a lot to be done in regards to purchasing a car, and the question then remains, who is supposed to do it. It can be done by the person that’s purchasing the vehicle on their own, or you could hire an agent to help you go through the process.
If it’s done by the agent, you have another additional step to consider, and that’s the contract between you and your agent. The document will state what they have the right to do in your stead and how much they will be paid for the service.
There are tax-related considerations to make when you purchase a car. There are also fees and paperwork that need to be handled when you make the purchase. This could be done by the buyer or by their agent that’s making the purchase on your behalf.
The taxes on a car mostly depend on how old the car is and also on how much gas it emits to the environment. There are also considerations about the MOTs and insurance policies that you should get on the car to be saved. It’s best to have an insurance policy that covers all the options and to inspect your car on the regular bases.