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It is not cheap to own a car in Singapore. Based on a 2019 Worldwide Cost of Living Survey carried out by the Economist Intelligence Unit (EIU), Singapore “remains the most expensive place in the world to buy and run a car. There are many factors to take into consideration before purchasing a car. The best would be to calculate an estimate of what you would be required in your savings.
- Purchasing price
The car price would depend on which category you want to purchase.
| Category | Vehicle Class |
| Cat A | Cars 1600cc & below, and the engine power should not exceed 97 kilowatts (kW) |
| Cat B | Cars 1600cc & above, or the engine power output exceeds 97 kW |
On top of the car price, you would be required to pay for a Certificate of Entitlement (COE) which is valid for 10 years. The prices of the COE are determined through bidding and depend on demand and supply thus making prices fluctuate. There would be a non-refundable administrative fee from $2 to $10. If your bid was successful, a deposit of $10,000 will be deducted.
Afterwards you would have to either scrap it or bid for another COE at the current prevailing price if you wish to continue using your vehicle for another 5 or 10 years. If you choose to renew it for 5 years, you can only do it once and have to deregister your car after the 5 years have ended.
Not to mention there is a $220 registration fee, the Additional Registration Fee (ARF) which can range between 100% to 180% of the cat’s Open Market Value (OMV) and lastly the 20% excise duty.
However, you would have the chance to recoup some money back through the PARF system if you scrap your car before it turns 10 years old.
- Interest rates for loan
Most of the time, people will take out a car loan as one time payment can cause a huge dent in your wallet. By taking out a car loan, you have to bear in mind your monthly car loan repayments
- Road tax
Road tax is a recurring cost that has to be paid by all Singapore-registered car owners every 6 months. The amount of road tax required to pay would depend on the engine capacity (EC) in cc. The larger the engine capacity, the greater the road tax you have to pay. The table below shows the EC and the road formula tax
| Engine Capacity (EC) | Road Tax Formula (per annum) |
| EC<=600 cc | S$400 x 0.782 |
| 600 cc < EC <= 1000 cc | [S$400 + 0.25 x (EC – 600)] x 0.782 |
| 1000 cc < EC <= 1600 cc | [S$500 + 0.75 x (EC – 1000)] x 0.782 |
| 1600 cc < EC <= 3000 cc | [S$950 + 1.5 x (EC – 1600)] x 0.782 |
| EC > 3000 cc | [S$3050 + 2.0 x (EC – 3000)] x 0.782 |
For cars that are renewed after the 10 year period, there will be an additional road tax surcharge.
| Age of Vehicle | Annual Road Tax Surcharge |
| More than 10 years | 10% |
| More than 11 years | 20% |
| More than 12 years | 30% |
| More than 13 years | 40% |
| More than 14 years | 50% |
You can estimate your road tax with sgcarmart’s road tax calculator.
- Car insurance
It is compulsory to get car insurance. The amount you have to pay would depend on the assessment on the risk you would get into a car accident or filing a claim.
- Servicing, petrol, ERP, parking
Usually you would need to service your car once or twice a year. All car owners would have to continuously pay for petrol and parking.
On top of that, there is Electronic Road Pricing (ERP) which car owners have to pay during peak periods at roads where it is usually congested.
Summary
Deciding to buy a car is a huge decision where you have to be financially stable to be able to own one. It will take a lot of consideration of your financial situation. It is important to think and plan for the long run. If you have any doubt, you should contact your financial advisor. If you do not have one and wish to seek clarification on your finances, feel free to fill up this form!
