Jens E. Richter Automobile

Automobilexporte weltweit

About VAT and tax refund (for car buyers from outside the EU)

Not all German used cars have tax in the price...I'll try to explain:

If you buy an old car here there is no sales tax to pay at all and therefore there is no tax return at all! Note: All cars which have been owned and registered by private persons have no VAT in the selling price. No matter who is selling now.

Used cars, registered in the name of companies or financed/owned by a bank or leasing company are selling with VAT. A tax return is possible when exporting the car.

Every ad and every price tag will chow you clearly if VAT is included or not.

If you buy with my assistance, I will sell to you tax-free. But in that case I have to do the buying, the German customs documents and the shipment.

Some more about VAT (German Mehrwertsteuer):

All listed prices for brand-new cars and those with a company registration include 19% German sales tax (MwSt - Mehrwertsteuer = VAT - value added tax). If cars are sold by private persons, German sales tax cannot be deducted from the price when the car will be exported.

If you search German internet sites for used cars you will clearly see if the car you found has VAT in the price. It is always marked at the price tag.

If  you buy a car (with former company registration) from a dealer he will give you the net price by deducting 19% from the brutto price. This is very important for you, when you are not an EEC-citizen i.e. you pay only the net price when exporting the car to a country outside the EU.

In  most cases, when you pick up the car yourself at the dealers place, you  would have to pay the full price, but the tax will be refunded later by  the dealer when the car is exported and the  “customs-clearance-certificate” (Ausgangsvermerk) is presented to the dealer. You just have to proof that you car has left the territory of the EU.

Please be aware that most used cars have private pre-owners, hence no refundable tax.


Payment: How to pay for the car you found

If you buy from abroad you should know that German sellers (private and commercial retailers) do not accept payment by cheque or by credit card.  In your case, this means that you have to send the payment by Telegraphic Transfer (TT) to the sellers bank account. That can be a risk! Before transferring any funds, demand a pro forma invoice from the seller, check if the dealer has other cars in the yard, ask people you know in Germany to contact the dealer and/or to inspect the car.

When sending a wire to a German bank account please note: 

Because of the actual Money Laundry Law the sender of each money transfer has to be identified. It's called "Know Your Customer Priciple" just KYC. Please send a passport copy to the seller when doing a transfer. And the sender of the funds has to be the consignee of the car. Wires from third persons can cause problems. Discuss all that with the seller before sending any funds.  

No payments by Letter of Credit (LC):
This is normally a perfect methode of payment in international trade transactions, however, not for used cars!
It is a practicable transaction method for purchasing new vehicles in large numbers or very expensive machinery or equipement. No dealerships or private sellers of used cars will accept this payment method because: An LC takes time to clear and the banking fees are very high. Most sellers have no experience with exports and don’t know how an LC works. LCs are not  commonly used to it in the second hand auto trade. Maybe people are also afraid of the excessive amount of beaurocracy LCs require. The used car  trade is a business requiring fast turnarauound, and an LC simply takes  too much time. 


If  you want me as your supplier for a used German car, if you want  further  information about German cars, if you need a partner in the  German  market:
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