Shipping info when importing a car from Japan

So you want to import your own car from overseas, where do you start, what do you do, how does it work?

Here is a rough guide as to what happens, when is happens and what you need to do to get your car into the country and taxes paid.

Kleerfreight Ltd (www.kleerfreight.com) provide a link between you and HM Revenue & Customs to pay your taxes, one of the steps that you will need to undertake before you get your grubby little mitts on your car at the docks, many people here have used Kleerfreight in the past, ask around!

 So here is your rough guide, like everything on the planet, things change, rules & regs change as do tax rates etc to do not take this as a definite ‘you told me’ affair it is meant as a handy guide. 

Step 1.  You have found your car & have paid the exporter.

 There are differing shipping terms used by the exporter these are usually the two main ones:-

(a)     FOB or ‘Free on Board’  - This means that you have paid for the car and that the exporter will arrange to get it on a ship for you, on top of this most exporters charge an export fee to cover admin.

(b)    CIF or ‘Cost, Insurance & Freight’ – This means that you have paid for the car, its shipping to arrival UK port and an insurance premium ( sometimes C&F is used where no insurance is taken) again this may be subject to an agent fee for admin or they may include it in the total price.

 Remember these phrases as you will need them later in the calculation stages!

 Step 2.  Your exporter send you all documentation relating to the vehicle.

 Once you have paid your man & the car has been put on a ship you receive a package from them which includes the following items:-

  1. Invoice for the car / (shipping & Insurance if applicable)
  2. Japanese De-registration form ( other country of export use different form including Police forms / certificates of title etc)
  3. English translation of De-Reg form (not always received)
  4. A ‘Bill of Lading’ – this is a shipping document and is used for release of the vehicle when it arrives and proves title to the goods with the shipping company.

 He may give you an indication of when the vessel is due to land in the uk (known as an ‘eta’)

 Step 3.  Ive got these documents what happens next?

You will need a customs clearance agent (www.kleerfreight.com is a good place to start!)

The customs agent will require FAX copies of all documents listed from 1 to 4 above ( fax number 0871 226 0199)

You should also complete a customs form C384 (available from Kleerfreight website) and fax that to your agent too.

You will also receive an invoice from the shipping lines UK office giving you advice of how much money is outstanding to them for release of your car once cleared.

Fax all of this to your customs clearance agent, he will then be able to calculate the taxes due against your vehicle.

Kleerfreight charge a total of £75.00 for this service, once they calculate your taxes they get back in touch and give you the amount and an account to pay the amount into, the only person who delays your car after this point is you getting the funds to your agent!!!!

Step 4. Calculation of Import duty & VAT.

At the time of writing this guide, HM Customs rate of import duty for a car is 10% of the CIF value. (remember step 1)

If you have bought the car FOB you will need to add the shipping amount & Insurance amount to this part to get your CIF price.

Rates of exchange change on the first day of every month for customs purposes.

Duty is calculated at 10% of the CIF Price

VAT is calculated on the CIF price PLUS the 10% duty amount PLUS any UK charges ie clearance etc.

Let go through an example,

My invoice is FOB and ive paid £1500.00 for my car

I don’t have any insurance & my Shipping has come to £500.00 to get the car to the UK port.

I have paid £150.00 for my UK charges all in (clearance, terminal handling to shipping line, documentation etc all these little bits add up!)

Therefore my taxes are calculated as follows :-

DUTY (10%)

Car £1500.00

Shipping £500.00

Total for duty purposes £2000.00

Duty due at 10% therefore is £200.00

VAT (17.5%)

Car £1500.00

Shipping £500.00

Duty £200.00

UK Charges £150.00

Total for VAT purposes £ 2350.00

VAT due at 17.5% therefore is £411.25

Step 5. Ive paid my taxes, the car has arrived and cleared customs

In your document envelope from the exporter you had (item 4.) a bill of lading. The original of this document proves to the shipping company that you are entitled to the vehicle after payment of their charges.

The invoice you received from the shipping company needs to be settled and the original bill of lading needs to be lodged with them, you can do this in advance or on the day of collection.

 

Step 6. Go collect your car

Easy!

You will then need to go through the motions of testing & registering your vehicle but that’s another story.

This guide seems to make the process look very simple and using the right exporter and clearance agent this end it can be.

One word of warning / advice – choose both very carefully!