Has anyone encountered gst on additional car loan?

[Hoshi8]

2 scammers identified.

????

[Galantspeedz]

So I guess it's normal then

Thanks for the info. I will just pay the dealer.

 

wait... he charged as admin fee not gst....

 

http://www.mycarforum.com/topic/2701003-dealers-and-consumers-the-continuing-saga-part-iii/page-6

 

read post 114, 124 and 148

[Wattokkingu]

Why need to stick to this PI? If it is a common car model, just look for other PI. GST paid on car loan sounds like a load of bull to me. IMHO, you should just walk away from this deal, customer is king.

[shrjun]

2 scammers identified 

 

 

buyer and PI

????

 

 

......

[BenTong]

Why need to stick to this PI? If it is a common car model, just look for other PI. GST paid on car loan sounds like a load of bull to me. IMHO, you should just walk away from this deal, customer is king.

Gst has to be paid on the omw and dealers profit if not mistaken. ARF and COE not included. So the extra $20k is part of cost of car. So got to pay GST. Not about loan or additional loan.

 

Think TS wanna go around the financing framework. This is one of the consequence.

[SuPerBoRed]

aiya.. ..  why all the serious replies??? 

 

this is an april fool's joke yea? 

 

ALL MCF forummers use full cash?? simi loan? simi additional loan?? 

[Kusje]

????

 

You mean you don't know you are cheating the bank?

[Mnns]

i rem a forumer, he declare himself as car dealer, mentioned need to pay GST for the additional loan because the dealer themselves over declare so as to "help" the buyer get loan for the car

 

Yup, I remember him too. He mentioned he need to declare the inflated selling price on his accounts, so his customers has to pay for the taxes or admin fees he will end up incurring by 'helping' the customer to qualify for a higher loan which otherwise the customer couldn't afford. 

[Watwheels]

Overtrade is not cheating bank lah. http://www.sgcarmart.com/news/article.php?AID=8617

 

 

For instance, a buyer of a $100,000 new car will need to put down at least $40,000 as downpayment. In overtrade, the seller will rise the car price to $110,000, and at the same time giving $10,000 more than what the trade-in car is worth

 

If I'm not wrong, if the dealer is giving additional 10K on the trade-in car price, he's providing a service. GST means goods & service tax hence it falls in the category that's why it's 7% chargeable. But the thing is buyer is trading in his old car or selling the old car to the dealer 7% gst should be considered as well. Logically the 7% should be offset and waived.

 

The overtrade thing is very confusing for buyers. Maybe the authorities should make it clear that overtrade is a service which dealers provides and it's chargeable for gst.

 

If buyers are able to meet the loan restrictions there's no need for overtrade. So TS go find ways to meet the deposit requirement so that you do not have to deal with the overtrade thing. MCF got a lot of loaded members who buy cars using full cash. Page for them.

Edited April 1, 2016 by Watwheels

[Kusje]

Overtrade is not cheating bank lah. http://www.sgcarmart.com/news/article.php?AID=8617

 

 

Where in that article does it say it isn't cheating the bank?

 

What is the price that the buyer/dealer declares to the bank as the purchase price? 

[valian]

Just want to find out if it's normal for such a charge.

 

to be honest, i've seen some dealer asking for it and some don't. I guess it's whether they can sense how desperate you want the car, so i don't think it's a industry norm.

 

anyhow, just buy want you can afford bah, no point wasting extra money just to afford something out of range. 

[Hoshi8]

Gst has to be paid on the omw and dealers profit if not mistaken. ARF and COE not included. So the extra $20k is part of cost of car. So got to pay GST. Not about loan or additional loan.

 

Think TS wanna go around the financing framework. This is one of the consequence.

Yes in a way, I still can't bear to pay so much downpayment therefore checking with dealer with higher loan amount options. Guess now got to either pay the gst or pay the 50% downpayment.

[Hoshi8]

You mean you don't know you are cheating the bank?

Honestly I'm just asking the dealer for alternatives and was posted with his proposal with gst. I do not know that this is considered cheating.

wait... he charged as admin fee not gst....

 

http://www.mycarforum.com/topic/2701003-dealers-and-consumers-the-continuing-saga-part-iii/page-6

 

read post 114, 124 and 148

Thanks bro. I have read and understood the process. Now it's decision making time to whether to cheat the bank or pay 50% down. Actually my interim loan has already been approved and I got my Coe at the first bid.

[Watwheels]

Where in that article does it say it isn't cheating the bank?

 

What is the price that the buyer/dealer declares to the bank as the purchase price? 

 

Bro, bank is not the one who determines the car price it's the car dealer. The bank just workout what is declared to them. So is this cheating?

 

Whatever the new car price the dealer inflate eg.10K he also give the buyer additional 10K for his old car to trade in. Is this cheating?

 

This is just a tool to overcome the loan restriction. If want to pursue it should be MAS. So go write to them and see what they reply to you.

[flashbang]

Like what others have figured out, the GST payment is due to the dealer's new inflated cost. 100k is GST inclusive and he's prepared to pay 7k GST, but if he declares as 120k he now needs to pay 8.4k GST. So he's recovering the 1.4k from you.

[Kusje]

Bro, bank is not the one who determines the car price it's the car dealer. The bank just workout what is declared to them. So is this cheating?

 

Whatever the new car price the dealer inflate eg.10K he also give the buyer additional 10K for his old car to trade in. Is this cheating?

 

This is just a tool to overcome the loan restriction. If want to pursue it should be MAS. So go write to them and see what they reply to you.

 

Why should I pursue this? I don't own any bank shares so I am not affected by this. Anyway, I think MAS already knows of this issue....

 

Yes it is cheating. The bank determines their risk appetite based on the market value of the car and then calculate how much they are willing to loan (capped by MAS as well) and at what interest rates.

 

Let's give an extreme example: I buy a condo from you at 1 mil but we declare to the bank that the condo is being bought for 10 mil (and they are stupid enough to accept that value). Based on that, I take an 80% loan for 8 mil dollars. 

 

Cheating or not?

Edited April 1, 2016 by Kusje

[Fruit-tart]

That's what my car dealer tells me. He said that it's the industry practice. By the way my dealer is a PI.

 

For example you buy a 100k car with Omv over 20k.

Max loan 50k. Dealer went to inflate the price to 120k n max loan becomes 60k. You need to pay 7% gst on the additional 10k.

Good luck.. obviously dealer trying to "player" with u..like u mentioned 100k, then dealer knw u only can fork out 50k, the 50% u take loan..so INFLATE the price to 120k lor...then max loan become 60k... then u pay additional lor.. first time hearing such things also(jus like some bros n sis mentioned).. but ohh well, some PI dealers like play "tricks" with u ... becareful...read full terms n conditions...go reputable PI.. if not, good luck!!!!!

[Hoshi8]

Good luck.. obviously dealer trying to "player" with u..like u mentioned 100k, then dealer knw u only can fork out 50k, the 50% u take loan..so INFLATE the price to 120k lor...then max loan become 60k... then u pay additional lor.. first time hearing such things also(jus like some bros n sis mentioned).. but ohh well, some PI dealers like play "tricks" with u ... becareful...read full terms n conditions...go reputable PI.. if not, good luck!!!!!

After reading the posts n comments. I somewhat felt that if I am taking this additional loan route, it's fair to reimburse the dealer for the loss they will incur with the overtrade.

 

First time buying from PI, but so far not too bad an experience.