With more opting to keep their cars beyond the initial 10 years, you might be tempted to renew the COE of your current car yourself.
Here’s a quick rundown of the costs associated so you know just what you will be facing should you opt to do so as well!
1. Prevailing Quota Premium
<img alt="" data-caption="There's no need to speculate and bid: PQP prices are stated as they are right here.
PHOTO: sgCarMart” data-entity-type=”file” data-entity-uuid=”8ad1f09c-254d-48fa-89fa-97856069a049″ src=”/sites/default/files/inline-images/20200902_quotapremium_sgcarmart.jpg”/>
What’s the Biggest Cost When You Renew Your COE?
The Prevailing Quota Premium (PQP) is the headline expense you’ll hit every time you renew your car’s COE. Think of it as the ticket you pay to keep your vehicle running in Singapore’s cap‑and‑trade system.
No More Bidding—Just a Handy Average
Unlike buying a brand‑new car, you won’t be standing in a crowded auction this time. The PQP is calculated by taking the moving average of the last three months’ COE prices from the month you plan to renew. So, if you’re renewing in November, your price is the average of August, September, and October.
What Does That Mean for You?
- More predictability – you’ll know roughly what the price will be before you even hit the renewal button.
- Less game‑the‑system excitement – no bidding wars, no wild speculation.
- Some relief if you’re on a tight budget – you can calculate your cost in advance.
Catch the Trend: Prices Are on the Rise (as of August 2020)
If your car is nearing a decade old, you probably want the best time to lock in a price that fits your wallet. Bookmark this page so you can hop in whenever the PQP drops to a level that feels fair for your budget.
Hawk the Lowest PQP
Want to snag the absolute cheapest price? Avoid the months when the LTA introduces new restrictions on the car population. Those months often lead to higher COE premiums in the following bidding session.
- Watch the calendar: LTA releases are usually announced a few months in advance.
- Plan ahead: Target renewal dates just before the restriction week.
- Stay informed: Keep an eye on news, because the market can shift with policy changes.
Bottom Line
Renewing your COE is now less of a gamble and more of a strategy game. By understanding how the PQP is calculated, staying savvy about market trends, and timing your renewal just right, you can keep your car on the road without blowing through your wallet.
2. Forfeited PARF rebate and outstanding COE rebate
<img alt="" data-caption="Make sure you weigh in potentially lost PARF and COE rebates before you decide to renew your COE, you might still be able to purchase another COE car.
PHOTO: sgCarMart” data-entity-type=”file” data-entity-uuid=”dd96d75c-99c3-40ff-958c-044f6f183dd6″ src=”/sites/default/files/inline-images/20200902_rebate_sgcarmart.jpg”/>The PQP prices may look like a harsh price to pay just to keep a car you already own. But if your car has not approached the full 10 years of age, you’ll also need to bear in mind that there are some ‘loses’ you will additionally incur after you renew the COE for your car.
If you do decide to renew your car’s COE before its first 10 years are consumed and then subsequently keep the car beyond 10-years old, those additional loses will come in the form of the forfeited
This rebate is forfeited when you opt to renew the COE on your car as it is awarded by the LTA in order to incentivise car owners to keep Singapore’s fleet of cars young as part of our policy to ease congestion. (In the LTA’s eyes a relatively young and roadworthy fleet is essential for maintaining smooth flowing traffic).
So if you opt to keep your car beyond the initial 10 years, and contribute to Singapore’s ageing car population, these incentives are naturally forfeited.
You can calculate just how much in rebates you will eventually be losing out by following the guide below.
The PARF rebate is calculated as a percentage of the Additional Registration Fee (ARF) paid when you purchased the car:
Age at deregistration
PARF rebate
Not more than 5 years
75 per cent of ARF paid
Above 5 but not more than 6 years
70 per cent of ARF paid
Above 6 but not more than 7 years
65 per cent of ARF paid
Above 7 but not more than 8 years
60 per cent of ARF paid
Above 8 but not more than 9 years
55 per cent of ARF paid
Above 9 but not more than 10 years
50 per cent of ARF paid
More than 10 years
Nil
Something else worth considering is that when you deregister a car younger than 10-years old, you will also be eligible for a
We replicate the example from OneMotoring here. Supposing you have a vehicle with the details as follows:
QP or PQP of 10-year COE paid
$16,897
Deregistration date
Jan 2, 2013
COE expiry date
June 5, 2015
And you opt to deregister this vehicle, the unused period of COE is calculated as follows:
From Jan 3 2013 to June 2, 2015 (counting in full calendar months)
29 months
From June 3, 2015 to June 5, 2015 (counting 30 days as one full month in June)
3 days or 0.1 month
Total unused period of COE
29.1 months
And the subsequent COE rebate will be calculated as follows:
COE rebate = QP or PQP of 10-year COE paid x Total unused period of COE /120 months
In this case that would mean (16,897 x 29.1 months) / 120 months = $4,097<img alt="" data-caption="Compare the COE rebates left on your car against current PQP prices to determine when it would be best to renew your COE.
PHOTO: sgCarMart” data-entity-type=”file” data-entity-uuid=”62e6bbbc-fec3-4d13-a53d-9781d9beb108″ src=”/sites/default/files/inline-images/20200902_coebiddingresults_sgcarmart.jpg”/>Of course, the flipside of not getting that COE rebate is that you keep your car for the full 10 years you initially paid the COE for.
So it isn’t necessarily a loss per se, but it is still worth considering if you’re undecided between renewing the COE for your current car or purchasing another second-hand vehicle, since you could have more cash to plough into your next purchase than you think.
Our advice? If you think COE prices are going to rise and never come back down, and if you got your current car with COE on the cheap, it might be well worth to forfeit the lower COE rebate you can enjoy now to shield yourself from higher future PQP prices.
Obviously, if you think the inverse is true: That current COE prices are not sustainable and if your car was purchased at record-high COE prices, then it will be well worth your time to wait and see, and only to renew your car’s COE when you are dead sure that the current PQP prices have reached rock bottom.
3. Increasing annual road tax
Is Your Car’s COE Renewal Going to Drain Your Wallet?
When you’re about to push that COE price tag back up on the register, don’t forget another sneaky culprit: the rising road tax. It’s like a hidden fee that sneaks in every year, especially if your vehicle’s been sailing the road for a decade or more.
Why Age Matters (And Not Just Your Car’s Birthday)
Oldie—goodie cars often come with big, thirsty engines. In contrast, modern models are leaner, more efficient, and can bump out the same power with a smaller motorcycle‑size engine. So if your cash flow is tight but you’re not looking to throw a huge sum into a brand‑new car, consider trading that 20‑year‑old 2.8‑liter monster for a second‑hand gem.
Road Tax Surcharge (The “Age‑Tax” Chart)
- Age > 10 yrs: +10 % road tax
- Age > 11 yrs: +20 % road tax
- Age > 12 yrs: +30 % road tax
- Age > 13 yrs: +40 % road tax
- Age > 14 yrs: +50 % road tax
Call it the “Age‑Tax” because it’s literally how long your car has been doing the wheel‑turning dance. The older the beast, the bigger the surcharge bakery gets.
Bottom Line
When it’s time to renew your COE, keep an eye on that road tax rate. Think about swapping that ancient engine for a smaller, sleek model if finances are a little stretched. Less money spent on tax means more in your pocket for coffee, emojis, or a spontaneous road trip.
4. Comprehensive insurance for COE renewed cars
<img alt="" data-caption="If your car is seriously aged, securing comprehensive insurance will become increasingly difficult.
PHOTO: sgCarMart” data-entity-type=”file” data-entity-uuid=”111f4f26-9fec-44a9-9687-75667c0235ab” src=”/sites/default/files/inline-images/20200902_insurancebuilding_sgcarmart.jpg”/>For those that want complete piece of mind for what is soon becoming a motorised family heirloom, you’ll also want to take note that shopping for comprehensive insurance will become increasingly difficult.
AXA, for instance, will not insure cars older than 25-years old, while others like NTUC Income, MSIG and Tokio Marine will offer comprehensive cover for cars older than 10 years only on a case-by-case basis.
This is because there simply isn’t as much demand for comprehensive insurance for COE cars as many owners deem it unfeasible to pay a hefty premium, which is disproportionate to the value of the car.
Insurers themselves are also reluctant to offer anything more than just third-party insurance (which covers claims by third parties only) for older cars, as they deem them to be more problematic and more susceptible to claims.
5. Vehicle wear and tear
<img alt="" data-caption="Look for worn suspension components – they could end up being costly to replace.
PHOTO: sgCarMart” data-entity-type=”file” data-entity-uuid=”b8cac884-7dd5-4032-ac8e-82e29de9b966″ src=”/sites/default/files/inline-images/20200902_wear%26tear_sgcarmart.jpg”/>One other expense that you’ll want to consider before opting to renew your car is the additional cost involved in maintaining a vehicle beyond 10 years.
Beyond this point, more components that might not have been considered as consumables will begin to fail and this will cost you not only in repair bills, but also in lost time and reliability of your vehicle.
One important thing to consider is the fact that at this point, for example, is that the dampers on your car may already need replacement. Furthermore, your car’s upholstery and interior may also be in need of a refresh.
Do consider if these things matter to you and if you think they need replacing, there is always the option of shopping for replacement part from our own extensive directory.
Interested in renewing your car’s COE? There are three ways to do it by yourself
Getting Your COE Tax on Track
Want to snag that Certificate of Entitlement (COE) tax paper? No worries – you’ve got options to get it in your hands without breaking a sweat.
1⃣ Online – Steer it through OneMotoring
Forget the old‑school paperwork. Just head over to OneMotoring, log in, and apply straight from your computer or phone. It’s quick, it’s convenient, and you can do it anytime you’re on the go.
2⃣ Traditional Mail – The “Modern Postal Service”
- Write up your application.
- Send it to the Land Transport Authority (LTA) Customer Service Centre.
- Post it to 10 Sin Ming Drive, Singapore 575701 – that’s the official drop‑off spot.
3⃣ In‑Person Drop‑off – Hands‑On, No Digital Hassle
- Grab a pen and a copy of your docs.
- Walk straight into the LTA Customer Service Centre at 10 Sin Ming Drive, Singapore (575701).
- Let the friendly staff take care of the rest.
Whether you’re a tech aficionado or a traditionalist, the LTA has made sure it’s easy to get your COE tax sorted no matter your preference.
Original article first appeared on sgCarMart.
