7. Motor vehicles
Within the subsequent paragraphs the following abbreviations are used:
- ADRs = Australian Design Rules
- ATO = Australian Tax Office
- GST = Goods and Services Tax
- ITCS = Indirect Taxation Concession Scheme
- LCT = Luxury Car Tax
- ** LCT is payable on all new cars and on cars under two years old where the value of the car exceeds the threshold amount of $57,466 (for the 2010-11 financial year). LCT is calculated at the rate of 33% of the value of the vehicle that exceeds the threshold amount.
For the purposes of this Section, privileged individuals are:
- Accredited Heads of Mission, diplomatic staff, members of the administrative and technical staff, and heads of consular posts, consular officers and consular employees. No exemptions from taxes and duties are available, however, to any person who is a citizen or permanent resident of Australia.
- Service staff, private staff, honorary consuls and members of the locally engaged staff have no entitlement to exemption from duties and taxes on motor vehicles.
- Please note that exemption from duties and taxes are never available for imported vehicles purchased from a motor vehicle dealer's showroom or car yard.
- Administrative and technical staff and consular employees must import or purchase their entitlement of one motor vehicle under privilege within the first six months of their arrival in Australia.
7.1 Purchase of motor vehicles under privilege
7.1.1 Purchasing a new Australian-manufactured motor vehicle
Where Protocol Branch approval is given to purchase a new Australian-manufactured vehicle under privilege from a motor vehicle dealer in Australia, GST and if applicable LCT must be paid. However, for all ITCS packages GST and any LCT paid can be refundable on application to the ATO.
7.1.2 Purchasing a new imported motor vehicle under bond
All diplomatic missions, consular posts (other than those headed by an honorary consul) and privileged individuals may purchase a new imported motor vehicle under bond from a motor vehicle dealer in Australia without the payment of Customs duty. However, imported vehicles purchased in Australia that are released from a Customs licensed bonded warehouse will be subject to GST and, if applicable, LCT, which will be payable by the mission, post or privileged individual. Depending on the ITCS package that applies, it may be possible to claim a refund of GST and any LCT paid. Please note that not all missions/posts/privileged individuals will be eligible for GST/LCT refunds.
7.1.3 Purchasing a new imported motor vehicle in Australia
Where a new imported motor vehicle is acquired from an Australian motor vehicle dealer's showroom floor or car yard, Customs duty, GST and where applicable LCT must be paid. Depending on the ITCS package that applies, it may be possible to obtain a refund of GST and any LCT paid. Please note that not all missions/posts/privileged individuals will be eligible for a GST/LCT refund. Regardless of entitlements, where a mission, post or privileged individual chooses to purchase an imported vehicle that has already been released from bond, the Customs duty cannot be refunded.
7.1.4 Directly importing a motor vehicle
Overseas-manufactured vehicles are often built to different specifications to those required for the Australian market. Any new or used vehicle that a diplomatic mission or eligible consular post or privileged individual wishes to import must conform to Australian safety and emissions standards. Before making arrangements to import a vehicle into Australia, import approval must be obtained from the Department of Infrastructure and Regional Development (Office of the Administrator of Vehicle Safety Standards, telephone: 1800 815 272; fax: (02) 6274 6013; the approval certifies that a vehicle meets the Australian Design Rules -ADRs). The vehicle must be fitted with a compliance plate indicating that it meets the ADRs. Failure to obtain such approval before importing a vehicle into Australia may result in considerable financial costs and could result in the imported vehicle having to be re-exported or scrapped. The Department of Foreign Affairs and Trade has no authority to override decisions of the Office of the Administrator of Vehicle Safety Standards and will not support registration in the ACT of a directly imported vehicle unless the Administrator has provided an appropriate certification.
Unless approval from the Department of Infrastructure and Regional Development has been obtained, it is unlikely that a vehicle will meet State or Territory registration requirements for the vehicle to be used on Australian public roads. Normally vehicles for use on public roads in Australia are required to be right-hand drive. Before bringing a vehicle to Australia, it is advisable to check with the motor vehicle registration authorities of the State or Territory where it is intended the vehicle be registered to ensure that the vehicle will meet their registration requirements.
Australia's biosecurity regulations applicable at the time of the vehicle's entry have to be complied with - clearance must be obtained from the Department of Agriculture after the vehicle has arrived at the port of entry. For more information visit the department’s website at www.daff.gov.au.
Motor vehicles directly imported (that is, not purchased from an Australian motor vehicle dealer) as the previously purchased property of a diplomatic mission, eligible consular post or by a privileged individual (as part of that individual's personal effects), will be free of Customs duty and GST/LCT. The mission/post/privileged individual must have paid for and have legal title to the vehicle prior to it being first landed in Australia in order to qualify for duty and tax exemption.
7.1.5 Purchasing a second-hand or used motor vehicle
Where a second-hand motor vehicle is purchased from a registered motor vehicle dealer in Australia, GST and if applicable LCT must be paid. For all ITCS packages, GST and any LCT paid may be refundable on application to the ATO. Used motor vehicles purchased in Australia from private sellers are GST exempt.
Privileged individuals, who purchase imported second-hand vehicles that are less than two years old from a registered motor vehicle dealer in Australia, will only be eligible to claim refunds of GST and any LCT paid if their ITCS package allows them to claim tax refunds on new imported vehicles.
7.1.6 Purchasing a motor vehicle from a privileged individual
GST and LCT is not leviable when a vehicle acquired under privilege is transferred from a privileged individual to another privileged individual who has the same or greater level of entitlements. Vehicles may be transferred between privileged individuals without payment of the Customs duty waived or repayment of the GST/LCT amount that was refunded. The new owner may dispose of the vehicle free of residual duty and GST/LCT three years from its original date of entry or delivery.
7.2 Limits on vehicles under privilege
Vehicle privileges are subject to certain conditions, including official and personal quantity limits.
7.2.1 Number of official vehicles
Diplomatic missions and consular posts (but not those headed by an honorary consul) are permitted to import or purchase a reasonable number of official vehicles under privilege according to the size and needs of the mission or post. As a general rule, Protocol Branch applies a quota of one vehicle for the Head of Mission or Post and one vehicle for each two diplomatic or consular officers (that is, excluding administrative and technical staff and consular employees) at the mission or post. Missions and Posts must seek the agreement of Protocol Branch before ordering additional official vehicles.
7.2.2 Number of personal vehicles
Accredited diplomatic staff and consular officers may import or purchase under privilege one vehicle for their personal use. A diplomatic or consular officer who is accompanied by one or more dependent family members may import or purchase a second vehicle under privilege, providing the dependant is a licensed driver and is not an Australian citizen or permanent resident. A photocopy of the dependant's valid and current licence (if necessary, with an English translation certified by the diplomatic mission or consular post) should accompany the application for the purchase of the second vehicle.
Administrative and technical staff and consular employees are permitted to import or purchase one vehicle under privilege, provided this is done within the first six months of arrival in Australia.
In circumstances where administrative and technical staff and consular employees have a subsequent posting to Australia, a period of at least three years outside Australia between postings must elapse before an entitlement to import or purchase another vehicle under privilege will be considered.
Where an officer and his/her spouse are both posted to Australia as diplomatic staff, consular officers, administrative and technical staff or consular employees, or any combination thereof, the Department will advise on their joint and individual entitlements in respect of the importation or purchase of a motor vehicle under privilege. Missions and posts are strongly advised to seek such clarification before any commitment to import or purchase a vehicle is made.
7.3 Purchasing a motorcycle under privilege
A motorcycle is regarded as a motor vehicle for the purposes of Sections 7.1 and 7.2 of the Protocol Guidelines. Motorcycles may be imported into Australia free of customs duty. Privileged individuals whose ITCS package allows them to claim tax refunds on new imported motor vehicles may seek a refund of GST paid on the purchase of a new imported motorcycle in Australia, subject to the applicable limits on the number of vehicles and conditions of their sale being met.
7.4 Application to purchase a motor vehicle under privilege
Applications by diplomatic missions, consular posts (other than a post headed by an honorary consul) or by a privileged individual for the purchase of a motor vehicle under privilege should be submitted individually for each vehicle to:
Department of Foreign Affairs and Trade
John McEwen Crescent
BARTON ACT 0221
using the blue Application for the purchase of a motor vehicle under privilege form (see Appendix 18). The application must be signed by the head of mission or an authorised person in the mission. Vehicle details, including make, model, year, body type, VIN/chassis and engine numbers, and contact numbers should be included on the application form.
Claims for Customs duty exemption on imported vehicles should be submitted, well in advance of the vehicle's importation. Vehicles that are purchased directly from overseas must be owned by the mission/individual before the vehicle is landed in Australia. Vehicles that are paid for after delivery in Australia will be subject to GST and LCT if applicable.
Claims for refunds of GST and if applicable LCT, where allowable, should be submitted directly to:
ITCS Claims Processing Team
Australian Taxation Office
GPO Box 9977
BRISBANE QLD 4001
using ATO form NAT 3155 Motor Vehicle Claim: Application for refund under Indirect Tax Concession Scheme. The claim can be submitted immediately following payment for the vehicle and must be accompanied by a copy of the blue Application for the purchase of a motor vehicle under privilege form (which must have been approved by both DFAT and Customs) and the original tax invoice for the vehicle.
Claims for concessions under the ITCS for refunds of GST, and if applicable LCT, on Australian-built and second-hand motor vehicles should also be submitted to the ATO following delivery of the vehicle, using ATO form NAT 3155 Motor Vehicle Claim: Application for refund under Indirect Tax Concession Scheme together with a copy of the blue Application for the purchase of a motor vehicle under privilege form.
Missions, posts and privileged individuals intending to purchase a motor vehicle under the ITCS should check first with the ATO, which administers the arrangements, to confirm refund entitlements. The ATO can be contacted by telephoning 1300 880 283. The relevant ATO web-site is www.ato.gov.au/itcs. Advice on these entitlements may also be obtained from the Department of Foreign Affairs and Trade by telephoning (02) 6261 2915 or (02) 6261 2273.
7.5 Replacement of a motor vehicle under privilege
Where a diplomatic staff member or consular officer has been in possession of a vehicle purchased under privilege for three or more years, approval may be sought from the Department of Foreign Affairs and Trade to replace that vehicle with another vehicle purchased under privilege. Any application for such a replacement needs to be made before the sale of the vehicle that is to be replaced, and accompanied by a statement from the Head of Mission or Post that the officer is expected to remain in Australia for at least a further 18 months.
This facility is available to diplomatic and consular officers only. It is not available to administrative and technical staff or consular employees who have first entry privileges only.
Where a vehicle purchased under privilege has been stolen or damaged beyond repair, or returned as defective, concessional disposal may be approved, in which case any residual duty and/or GST (and LCT where applicable) must be paid. (See Section 7.7 on the need to have full comprehensive insurance to cover this possibility.) Once the residual duty and/or taxes have been paid, the purchase of another privileged vehicle will be allowed and the rules as noted in Section 7.1 will apply.
7.6 Registration and number plates
All motor vehicles to be used in a public place in Australia are required to be registered. Those owned by diplomatic missions and consular posts, by their respective staff members and by dependent members of their household must be registered with the local registration authority and are required to carry diplomatic or consular plates unless the approval of the Department of Foreign Affairs and Trade has been given to use standard registration plates or unless, in some State or Territory jurisdictions, other provisions apply (see below). (This approval is given only in exceptional circumstances. If any mission or post believes such exceptional circumstances exist, it should advise these circumstances to the Department and seek specific approval on a case by case basis to use standard plates.)
Diplomatic number plates issued to foreign missions and diplomats in the ACT display the letters DC or DX followed by four or five numerals. The plates have black text on a powder blue background: the first two digits designate the mission with which the vehicle is associated and the last two digits identify the owner. Official vehicles and those owned by the head of the mission and members of the diplomatic staff of the mission and their eligible dependent family members carry DC number plates. Those owned by administrative and technical, and service staff of the mission and their eligible dependent family members carry DX plates. This applies, irrespective of whether or not a vehicle was purchased under privilege.
Requests for the issue of DC and DX number plates should be made to Protocol Branch, indicating the owner's name and the vehicle details, through a note verbale. Protocol Branch will allocate the registration number and arrange for the Dickson Motor Registry to issue the number plates.
In the States and the Northern Territory, 'CC' registration plates are available from the local motor vehicle registration authority. Requests for vehicle registration should be communicated in a note verbale to the relevant DFAT State Office. State and Northern Territory motor vehicle registration authorities issue CC plates for vehicles owned by consulates-general and consulates (headed by a career consular officer) and consular officers in their respective state or territory. Consular employees in most states are not issued with CC plates and must carry standard plates instead. In some states honorary consuls are also issued with CC plates.
Diplomatic and consular vehicles are not exempt from the requirements of the Motor Vehicles Standards Act, which relates to vehicle safety standards. Registration must be renewed every 12 months.
Motor vehicle registrations in the ACT are provided free of charge to missions, to their diplomatic and administrative and technical staff, and to dependent members of their households. The cost of registration in other states and territories is a matter for the relevant state or territory government authorities.
7.7 Insurance (Third Party and Comprehensive Motor Vehicle cover)
Compulsory Third Party Insurance (CTPI) is personal injury insurance that is mandatory for every motor vehicle registered in Australia. CTPI covers the driver at fault in a motor vehicle accident for personal injury claims made by other road users such as drivers, passengers, pedestrians, cyclists, motorcyclists and pillion passengers involved in a motor vehicle accident. CTPI is collected at the time the motor vehicle is registered or registration is renewed. It is not a government fee or charge since the CTPI is paid in its entirety to a licensed insurer. Not only is it an offence to drive a vehicle without CTPI but, in the event of an accident where someone was injured or killed, there could be serious financial implications resulting from legal claims for compensation against the uninsured driver.
Because CTPI covers only personal injury claims against the at fault driver of a registered vehicle, the Department strongly recommends that owners of all vehicles newly registered or reregistered in the ACT (in the name of diplomatic missions or international organisations, or accredited staff or dependents) also purchase third party property insurance for the same period covered by CTPI for the vehicle. This is available from all reputable vehicle insurers and covers claims for repairs to property (except the at fault vehicle) that is damaged during an accident.
The Department also strongly recommends what is known as comprehensive insurance for all motor vehicles purchased under privilege (that is: additional to third party personal injury and instead of third party property insurance). In addition to the benefits of third party property insurance comprehensive insurance covers the insured vehicle against accident damage and theft. Comprehensive insurance should be sufficient to cover the full market value (i.e. including duty/taxes) of the vehicle in Australia. The insurance value will then include any residual duty/taxes which must be paid if a privileged vehicle is stolen or damaged beyond repair.
The Department recommends that intending vehicle owners consult with a reputable insurance company and read the product disclosure statement before obtaining third party or comprehensive insurance.
7.8 Stamp duty
Stamp duty is a state or territory government tax. The requirement to pay stamp duty on purchases of motor vehicles is a matter which is handled by respective state or territory governments. The ACT Government does not charge stamp duty on vehicles purchased by diplomatic missions and privileged individuals.
7.9 Disposal of motor vehicles carrying diplomatic or consular number plates
If a diplomatic mission, consular post or privileged individual wishes to sell to a non-privileged person or otherwise dispose of a motor vehicle, whether it was purchased under privilege or not, a completed Disposal of Motor Vehicle form B791 must be submitted for approval to Protocol Branch. The form should list the owner and vehicle details, the proposed method of disposal, the proposed date of disposal, the reason for disposal and must be signed by the applicant. Protocol Branch will subsequently forward the form to the Customs and Border Protection Service for approval. Please note that the form will not be approved and returned until any residual duty and/or taxes have been paid to the Customs and Border Protection Service (see below).
Vehicles purchased under privilege may be sold without payment of Customs duty or GST/LCT three years after the date of entry to Australia (where the vehicle is imported into Australia) or, three years from the date of delivery in the case of an Australian-manufactured vehicle.
Approval for the disposal of a personal vehicle will normally be given where a privileged individual is transferred from Australia before the three-year period expires. Apart from this, the Department will only approve the early - that is, inside three years - disposal of a motor vehicle that was acquired under privilege in very exceptional and unforeseeable circumstances. The circumstances must be fully explained and endorsed by the head of mission or post.
Where approval for early disposal of a vehicle that was acquired under privilege is given, the privileged individual who is selling the vehicle will be charged pro rata duty and/or GST/LCT that would have been payable at the date of purchase, unless the vehicle is sold to another privileged individual (Subsection 7.1.6 refers). This is referred to as the residual duty and/or taxes and is calculated by deducting 1/36th from the duty and/or GST/LCT for each completed month of ownership. For the purpose of calculating the residual duty and/or taxes, whichever should occur first of the following dates is regarded as the date of disposal:
- the date of the vehicle's sale;
- the date of completion of posting (including retirement); or
- the date of departure of the owner from Australia.
The Customs and Border Protection Service will calculate the residual duty and/or taxes liability and will send to the applicant a Vehicle Liability Report indicating the total amount payable. When payment is received, the Disposal of Motor Vehicle form can be approved and will be returned to the applicant.
Where approval for an early sale of a vehicle that was acquired under privilege is given, and it is intended to purchase a replacement vehicle under privilege, it will be necessary to provide reasons for the proposed change of vehicle and demonstrate that no excessive profit will be made on the early sale of the original vehicle. The 18-month rule (Section 7.5) would apply.
Diplomatic number plates issued to a vehicle owned by a diplomatic mission or a privileged individual, or a dependent family member of a privileged individual's household, are not transferable when a motor vehicle carrying them is sold, or otherwise disposed of, and must be surrendered by the owner (or representative), together with the completed Certificate of Registration Notice of Disposal slip and a completed and approved Disposal of Motor Vehicle form, to:
Consular number plates of vehicles that are sold, or otherwise disposed of, must also be surrendered by the owner (or representative), together with the completed Certificate of Registration Notice of Disposal slip and a completed and approved Disposal of Motor Vehicle form, to the relevant state motor vehicle registry. This requirement also applies in the event of a privileged individual remaining in Australia after the termination of his or her employment with a diplomatic mission or consular post.
Where an official or personal vehicle is to be sold interstate or exported from Australia, the diplomatic mission, consular post or privileged individual should ensure that the registration on the vehicle is cancelled before the vehicle leaves the ACT or the State or Territory where it is registered, and the diplomatic or consular number plates are returned to the relevant motor vehicle registry. Once the registration is cancelled, a temporary unregistered vehicle permit may be obtained to allow the vehicle to be transported to the intended place of sale or port of embarkation. The vehicle must not be sold or transported interstate with the diplomatic or consular number plates still on it.