Posted by: www.primealgarverentals.com | January 17, 2010

Matriculate – or capitulate? The perils of importing a car into Portugal

If you’re looking to move over to Portugal full time – or even spend considerable amounts of time there – it makes sense to consider taking a car over from the ‘home’ country.   Cars are expensive in Portugal (about two thirds more than in the UK due to the taxes levied) and, if you’re going to be spending a lot of time there, why not save on hire costs and take a car there? 

Simpler said than done – not just in our experience but in thousands of others’ too.  In theory, the law is simple.  One car per person can be legally brought into the country tax free, as long as it has been owned for 12 months prior to coming over to live in Portugal and the process is initiated for matriculation – or tax free importation – within  6 months of taking up residency  ( a requirement for importing a car)

As the law appears quite simple, we duly took the necessary steps.  I bought one car in the UK (left hand drive) 12 months before moving to Portugal and my husband bought another at around the same time.  We took up residency within six months of arriving in Portugal (an easy process undertaken at the local Camara), employed a highly recommended expert to undertake the matriculation process (as most people do as the paperwork is horrendous), sat back and expected it all to go through without a hitch within about 6-8 months.  Twelve months – and thousands of euros later, one car has no status in Portugal (and thus technically illegal) and the other has 30 days to leave the country

How, you might ask, can this happen in a fellow member state of the European Union when a key tenet of the Union is the free movement of trade, labour and goods?  As two professional (and would like to believe highly intelligent) people we can’t understand it either – other than the Portuguese customs/tax authorities see  car matriculation as an easy way of collecting money from even the most ‘switched’ on emigrants.

 Indeed, they are the only country to have been taken to the European Court four times on this matter, and each time they’ve been found at fault.  But still it goes on – as the fines levied by the European Court are many hundreds of thousands of euros less than collecting the taxes from people who simply just give up on what should be a formalised – and easy – legal process for importing a car. 

It all started off ok.  We provided the original documentation for each car, the V5Cs, gained the necessary certificates of compliance from Nissan and Landrover, had the cars MOT’d in Portugal and all seemed well.  Then the obscure request to see the deeds of our houses came from Customs in Faro.  A strange request given we had provided countless pieces of paper demonstrating our identity/address, but hey ho, we thought,  if you need, them, we’ll give them to you as we have nothing to hide. 

What became apparent later was that the reason they wanted the deeds is that in Portugal these documents describe the ‘type of marriage’ you have (in the UK there is only one, in Portugal four).    So, what could possibly be the problem?  Well, unless you instruct your lawyer to do differently, your status of marriage will automatically be entered in the deeds as ‘casal sens bens’ or in other words, a marriage where what both parties owned when entering into the marriage becomes the other. 

As such, Customs claim this ‘state of marriage’ as being that my husband (as the dominant partner in a Portuguese marriage) was in effect bringing in two cars, not the allowed one.  Logic defies this view but to go with the flow, we got our lawyer in the UK to write a letter to state that in the UK there is only one type of marriage, and as the cars had been purchased in individual names after the marriage, we each owned one.  Customs did not accept this on the basis that the lawyer was ‘our’ lawyer and wanted us to prove, by production of a copy of the marriage law in the UK the status of marriage there.  That may sound a simple request to comply with, but as the last marriage law was passed in 1776 and related to age of consent, that wasn’t very helpful. 

Customs then produced a new argument (why they didn’t at the beginning make any of this clear I don’t know) in that as the V5C (commonly known as the ‘log book’) was in my husband’s name, it was clear he was trying to import two cars.  This is despite the fact that I had already provided a receipt to show that I personally had purchased the car (more on this later).  For anyone who is unfamiliar with the small print of a V5c, it clearly states that the name on the ‘log book’ is just the keeper, not the registered owner. 

 However, the Customs authorities would not accept this very clear statement on that document (or on the hundreds of official documents from the DVLA on line reiterating this fact).  DVLA (in an admirably short space of time) even sent an email confirming the status of the V5C, but again to no avail.  Customs insist it is a document of ownership.  (You may be wondering why, after all our careful preparations, the V5C for my car was in my husband’s name but the previous owner failed to notify DVLC of the sale of the car, and it was left to my husband to sign all the paper work whilst I was here in Portugal.   

So, a stalemate was reached.   All the conditions of importation had been complied with in terms of time of ownership, taking up residency, necessary paperwork, production of receipt etc but the response from the Customs authority in Portugal is still that ‘we can’t prove ownership of the car’ as the status of our marriage undermines our claim that I own the car, the receipt is not a proper ‘factura’ or invoice (there is no company name or tax number  on the receipt as it was bought privately from Ebay – something that Customs could not understand) and they wouldn’t accept the formal declaration from a UK government department that the document of keeping is not a declaration of ownership.

The final decision during a meeting with the Head of Customs was that he (not us) would decide which of the two cars would be matriculated – or legally imported free of tax – and he decided on the Nissan (the right hand car) which would not have been the one that we would have chosen  if we had to choose between the two. 

 However, this sorry story did not stop there. 

We were subsequently informally told that the Nissan would be provided with its plates within 7 days of that meeting.  We were off to Borneo and Australia during that week (but needed the car for our house sitters) and nothing happened.  Equally, what the Customs people didn’t tell us, was that the car couldn’t be driven by anyone other than the owner (my husband) or his wife or children – something we only found out by chance with the penalty being impoundment of car and payment of the tax due (30K euros on a car worth 15K euros).

 After much chasing and ‘back door’ investigations, it transpired that as Customs knew we were going away for three months, they decided not to issue the plates until we came back (apparently there is a little known condition that if  you leave Portugal for three months or more during the matriculation process, the process ‘runs out of time’ with no right of appeal).    

In effect therefore, one is ‘trapped’ in the country for three months (it’s not a bad place to be ‘trapped’ but we had a wedding to go to in Borneo and couldn’t possibly cancel).  Even worse, the car during this period is ‘illegal’ and cannot be driven at all and is tucked up in the garage awaiting our return and hopefully registration under a Portuguese plate (but how we are supposed to drive this ‘legally’ to Faro (75 km from where we live) to get the plates is a mystery)

As far as my car is concerned, we are taking this to appeal in Lisbon.  As part of this process we have had the  letter from our lawyer  ‘notarized’ at great expense to prove that the lawyer is acting in good faith as opposed to on our behalf.  I have called every number belonging to the name of my car’s previous owner in the whole of Yorkshire, in an effort to get a receipt which the Customs authorities will recognise as a proper invoice or factura (although how we’re supposed to do this for a private sale is beyond me).  Having no luck with that route, I even went as far as employing a private detective who has still to find the original seller. 

At this point you may be wondering, why on earth bother – why not just sell my car and buy another in Portugal?

 The answer is simple and a case of partly finances, partly practicalities.  Who wants a left hand car in the UK (and I can’t sell it in Portugal as it has ‘no status’).  Secondly, the taxation that the customs people want ranged from 19K euros on  a Friday night to 22K euros on the following Monday – without any explanation whatsoever for theincrease over the weekend.  For the Nissan, 30K is required.  The value of the cars?  £10K for the freelander and £15K max for the Nissan.  In terms of practicalities, my car was supposed to leave the country five days ago, and as I am away how on earth do they expect us to get it out of the country? 

Moreover, why SHOULD I take it out of the country? Portugal is part of the European Union.  The UK likewise. We complied with all the regulations to import the car – and it is not our fault that we have only ‘one type of marriage’ in the UK or that the Portuguese authorities will not accept the fact that theV5C is not an ownership document.  Equally, with a valid receipt, which would be valid in a court  of law in the UK, one would assume ownership is defined. 

Clearly not so and having gone through this experience – which is still not resolved as we have two cars that are effectively ‘holed’ up in our garage and can’t be used and with no legal means of taking either to either register or get out of the country – one might ask why we just don’t drive the car illegally as many people who have lived in Portugal do for years. 

However, being good European citizens and wanting to comply with the laws of our adopted country, we decided to do it properly in line with the laws of that country.  I would like to say to anyone else – don’t bother – but the penalty for having a car in Portugal for more than six months (even from another European country) is confiscation of the car until the taxes (which as I said earlier are roughly two thirds to a double more what the car is worth) are paid (and I can assure you, the amount will depend on the supervising customs officer of the day).

So, if you’re thinking of bringing a car into Portugal:

  1.  Make sure your deeds do not have the phrase ‘casal sans bens’ in it – this is a standard phrase that lawyers use for all purchasers from the UK and Ireland.  Your lawyer can easily insert a different phrase (they have a list of them for other nationalities) which will save you all these problems
  2. Make sure that the V5C  for each vehicle is in different names – you and DVLC may not see it as a document of ownership, but the Portuguese authorities – however erroneously – certainly do
  3. Make sure you have a receipt for purchase for the vehicle that includes not only the full name, address, and description of vehicle (as I did) but also the seller’s passport number and National Insurance number (which is the equivalent of the ‘fiscal’ number in Portugal) and have the receipt laid out as a proper invoice or facture as though it was coming from a business.
  4. Don’t let anyone other than yourself, wife or children drive the car during the matriculation process – you are not told that it is illegal (I think they just want to catch you out) but it is a new (and unknown) law that apparently came into force in 2010
  5. If you’re getting to the end of the matriculation process (successfully I hope) then don’t leave the country for any length of time.  Again, not communicated (and I am not even sure this is in the law) but you do need to plan to stick around until you have the plates in your hand. 
  6. Unless you really want to keep your car, think carefully before importing it – whilst the expenses associated with matriculation make it financially worthwhile,  it isn’t worth the hassle if you want a normal life during the process (which is of course, exactly what the Portuguese  and government want you to do)

The moral of the story – everyone will tell you it’s difficult to matriculate a car, but do be prepared for it to be almost imposible.  There are no clear laws available (I speak Portuguese and I have searched and searched), the authorities are unable (or unwilling) to provide and the whole process is like pushing water up hill.  However, I’m not giving up as I believe it is a right of a European citizen to take a car from one country to another – and not have either their car (or its owner) be held ‘hostage’ during the process.

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Responses

  1. Thanks for sharing your frustration, it was very interesting. I have the same issues and every time I look at the extortionate prices of cars here in Portugal I want to cry. I do understand the ‘when in Rome’ argument but by the same argument ‘when in the E.U’ one should expect to have the E.U rules applied, not so?
    Anyway, I feel for you and hope it all comes out to happy motoring (without looking over your shoulder, as I do!!)

  2. I read with interest your message ref.the importation of your cars from the UK. In Jan 2005 I attempted to matriculate a LHD BMW 320 Touring which was new. The car arrived at my house in the Algarve by trailer as I was aware that I couldn’t drive it legally until I matriculated it under Portuguese law. The procedure took over a month despite using a local professional agent to assist me. What I found concerning was not just the extortionate car tax I had to pay(15,000 Euros),but they ilegally charged I.V.A(vat) on top of the car tax.(3,000 Euros). Like you I really love this country,and thought it appropriate to matriculate my car and be comfortably legal. I took my case to the European court through a respected lawyer here,trying to get the 3000 Euros of ilegal I.V.A. returned. I won my case late in 2005.
    You,ve guessed it,I still haven’t received my money back. The Portuguese government do not recognise Brussels.
    I still have the same car,but the next time I have to replace it,I will purchase one in Spain,where they are far cheaper than most places in Europe. It is only one hour to the border from my house,so if necessary I can “leave the country” as and when required. I have a daughter who lives and works in central Spain,so I can register the car in her name if necessary. When it requires an MOT I will simply take it over the border.

  3. Hi Very interesting story, and factual with regard to the [vat]
    I UK citizen but moved here some 5 years ago, However the nature of my work during the past 5 years meant that i had to spend a lot of time around Constanta Port, Romania, doing survey work around the ships in the ports Romania, and Bulgariia, i bought a car rather than hire due to the costs, and changed it in 2009 to a BMW X5 for more comfort, particularlt around the poor condition of the roads , but now i ma retired and wish to bring THIS car to Algarve Portugal… I have heard of this IVA charge which is illegal, and i have no desire to pay for this cost on top of the matriculation, ? Maybe you could suggest the best solution, Reg in Gib? Spain? how do i go about getting plates ?
    would appreciate you good advice
    Thomas Orr
    thliorr@gmail.com


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