Automobiles and the property relocation exemption

Import duties and taxes on automobiles can, depending on CO2 emissions and the value of your car, entail high costs. Taxation of Passenger Cars and Motor Vehicles (hereinafter referred to as “bpm”) is usually due when importing cars from an EU country. When cars are imported from a non-EU country, one has to pay VAT and import duties, in addition to bpm. If you will soon be moving to the Netherlands from abroad, it will be possible to bring your cars and other vehicles to the Netherlands tax-free. In order to do so, the conditions for the relocation property exemption must be met. Read on below to see if you are eligible for the relocation property exemption.

Relocation property exemption

To take advantage of the relocation property exemption and import your cars and other vehicles exempt of bpm, VAT and import duties to the Netherlands, a number of conditions must be complied with, namely:

• You are emigrating to the Netherlands;
• You have not lived in the Netherlands during the twelve months prior to emigration;
• You privately own one or more vehicles;
• You have already owned the vehicles for six months prior to emigration;
• The car will not be lent, pledged, hired out or transferred for at least twelve months subsequent to the tax exemption taking effect.

In addition to the above overall position, there are also some special situations where, under certain conditions, no bpm, VAT and import duties are due on vehicles. See below if one of these special situations could apply to you.

Car of a foreign employer

You live in the Netherlands and receive a car from your foreign employer that has been registered abroad. The import of the car is exempt from bpm, VAT and import duties if:

• The car in the Netherlands is used exclusively by you and your family;
• You have a written statement from your employer stating that the car is principally used for the performance of work in the Netherlands;
• You have no influence in determining the country in which the vehicle is registered.

Car registered abroad for your own company

You live in the Netherlands and have the use of a car that has been registered elsewhere than in the Netherlands and you are somewhere else besides the Netherlands:

• Head of a sole proprietorship; or
• Member of a partnership; or
• Director, partner or shareholder of an undertaking, established in the form of a company.

And

• The car is used exclusively by you and your family;
• A mileage record shows that at least 50% of car use is for business purposes outside the Netherlands.

Temporary exemption

You are given a car that has been registered abroad for temporary use (up to a maximum of 2 weeks) and you meet the following conditions:

• You and your family have not been on the road in the Netherlands with this vehicle in the previous twelve months; and
• You must have given electronic notification of this prior to the use of the vehicle.

Examples

To illustrate the advantages of the Relocation property exemption you can find three exemplary calculations below.

Would you like to find out if you could make use of the relocation property exemption and the extent of the tax benefits for you? If so, please don’t hesitate to contact us.

More posts by Jimmy Cox

• Ignite DAO
• Dutch Hedge Fund
• Dutch withholding tax act coming into force on January 1, 2021
• Automobiles and the property relocation exemption
• Tax liability for foreign substantial interest holders
• The impact of MLI on Treaty Benefits
• Investing in Foreign Real Estate by Dutch Residents
• Am I required to pay the Waste Management Contribution?
• How do I invest in the Netherlands?
• Travel agency scheme