Plenty of people know how to set a budget when it comes to buying a car – either working out the maximum lump sum they can stump up, or figuring what the ceiling for monthly payments on an automotive finance deal could run to – but many often forget all the ongoing costs associated with running a vehicle.
So we’ve compiled a little list of expenditure that you shouldn’t forget about if you’re trying to balance the euros and cents for the year ahead.
Two things are certain in life…
Death and taxes. And the latter of these is, obviously, what we’re concentrating on here. Assuming you have bought a second-hand car, you’re going to need to know how much it’ll cost in motor tax. This can be paid for every three, six or twelve months, so you can spread the payments out if it helps, but you need to be aware of your annual commitment – however this is split up.
There have been three main systems of motor road tax in Ireland. The first was valid on any car registered before 2008 and went on engine capacity – and if you choose a used car that has anything bigger than a 2.3-litre (2,300cc) powerplant, then you’ll be looking at a four-figure annual tax bill, minimum (€1,034 as the cheapest level, rising to €1,809 for anything with 3,001cc or more).
After that, we switched to a CO2-based system of taxation, with fees set by how much of the greenhouse gas your car kicked out of its exhaust. The first tiers of this setup applied from January 1, 2008, until December 31, 2020, and had seven bands from A to G. Only zero-emission electric cars qualified for the lowest rate of annual tax, at €120, with everything that emits at least 1g/km of the gas costing €170 per annum, minimum. But for particularly polluting cars, which sit in Band F (191-225g/km) or Band G (226g/km and above), you’re again going to be into four figures for motor tax: €1,250 for Band F or a whopping €2,400, every year, for anything in Band G. So choose that used, 2017 performance car wisely.
This CO2-based system was revised in 2021, to reflect the greater nuance in cleaner, lower-emitting vehicles like PHEVs, and small-capacity petrol and diesel cars. Bands were rearranged purely numerically, so for 0g/km it’s €120, for 1-50g/km tax is set at €140, 51-80g/km is €150, and so on. We won’t list every single band, but it’s worth pointing out that while things rise slowly and incrementally up to any car which emits 140g/km (the tax only rising €10 a time for each band), after that there’s a 60-euro leap to €270 per annum for 141-150g/km and then €280 for 151-160g/km.
But then things get serious. It’s a series of big jumps for 161-170g/km (€420), 171-190g/km (€600) and 191-200g/km (€790). Above there, it’s the same two top rates of tax as for the 2008-2020 cars, with 201-225g/km at €1,250 and greater than 225g/km €2,400. And it’s no good saying you didn’t know what the engine capacity of your car was, nor what CO2 emissions it puts out – the relevant details are on the vehicle registration certificate (VRC).
Roadworthiness is essential
After motor tax, another legal requirement is the National Car Testing (NCT) programme. This is a roadworthiness check that must be carried out on every privately owned vehicle in Ireland, from the minute they reach four years old. Up to the age of ten years old, cars must be tested every two years, but from ten years old and onwards it moves to an annual cycle.
With a flat fee of €55 per NCT, it’s not the most expensive single cost when owning a car, but if the NCT throws up faults on the vehicle which need remedying, you need to be prepared to have the budget to effect the repairs necessary – otherwise your car won’t pass the NCT and you won’t be able to drive it on the roads. And that leads on to…
Maintenance fees
Repairs, servicing and maintenance are all essential aspects of owning a vehicle. Some costs are expected – for instance, your car will have a manufacturer-approved service schedule, sometimes annual or alternatively biannual, at which point it will need to go into a garage for a check-up and a change of vital fluids and filters. If your car is reasonably young and of a higher value, this means you’ll likely take it to a main dealer of the manufacturer in question, which can lead to service bills running into the hundreds of euros at a time – even if the car is in perfect health. You need to remember to keep that money to one side, especially on older second-hand motors that are more than five years into their service life.
Other costs can come out of the blue – such as a service highlighting that something is wrong with the car and needs remedying, or if you manage to lightly bump or scrape the car, or damage one or more of its wheels. Make sure you’re covered in the instance you’re suddenly hit with a bill of €300 or €400 (and more) just to keep the car in tip-top shape.
Insurance costs
Insurance is a necessary evil and something that will cost you a lot more per annum if you’re an inexperienced or high-risk driver, or you’ve picked a desirable and high-performance car and you’re parking it on the public street instead of on a driveway or in a garage. A recent review showed that the average cost of car insurance across the country is around €623, and you either need to pay for this in one lump sum, or spread out the costs monthly – but, be aware, if you do that then interest is charged and, ultimately, over the course of 12 months you’ll pay more than you would if you’d just covered the premium’s cost in a lump sum. And as younger drivers can face particularly high insurance costs, it’s worth making sure that your dream vehicle isn’t going to break the bank once you factor insurance premiums into the mix.
Don’t forget finance repayments
Some people might be good with money and have squirrelled away a nice lump sum with which to purchase a car. But for the rest of us, finance will be the only way to buy a vehicle – either by sorting out a bank loan for the money and then paying it back, or by availing of car finance such as PCP or HP. Either of these methods will have a monthly repayment fee, that again will be in the order of several hundred euros each time, so this needs to be borne in mind when purchasing a car right at the extremities of your financial reach.
Ongoing sundries
Once you’ve factored in the ‘biggies’ above, you need to remember the day-to-day considerations. All cars have various things on them called ‘consumables’, which means they will be used up or worn out over time and with usage, no matter how dependable your car is nor how fastidiously you look after it. The most obvious one is fuel, so the more kilometres you do week on week, the more you’ll be paying out on either petrol or diesel. Alternatively, electric vehicles (EVs) still need charging, and if you use high-speed public DC connections on a regular basis then you’ll be paying a lot more for your electric propulsion than you would by charging at home on an AC wallbox.
There are also various lubricating oils and essential fluids (brake, cooling, washer) that need to be monitored and topped up or replaced from time to time, while the windscreen wipers, the tyres and the brake discs/pads will slowly degrade over time. Each of these individual items might not be that expensive to replace or replenish, but if you don’t keep on top of looking over them and end up needing to fit four new tyres, a set of brake pads and an engine-oil change in one go, you could suddenly be landed with a hefty invoice for the car.