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What You Need To Know Before Renewing Your COE

Car ownership is expensive in Singapore. As if Certificate of Entitlement (COE) bidding was not intense before, now that it has resumed post circuit-breaker, we can only expect it to get even more competitive from here on out. 

(Related story: Private Car Owners To Continue Paying COE And Road Tax)

It is no wonder that more and more people are choosing to renew their COE after 10 years instead of deregistering and buying a new car, especially when their vehicle is in good condition.

If you are thinking of renewing your COE, here are all the things you have to know before you do so!

What is COE renewal?

A Certificate of Entitlement (COE) allows you to own and use a vehicle in Singapore. Upon expiration of your COE, you must either renew it in order to keep using your vehicle, or deregister and dispose of it.

(Related Story: The Fundamentals Of Singapore’s COE System)

Why should I renew my COE?

Buying a new car entails going through the entire COE bidding process all over again, as well as pay the full price of the car.

Should you renew your COE instead of buying a new car, you will only have to pay the Prevailing Quota Premium (PQP). Do note that PQP is not fixed, as it is the moving average of the Quota Premium COE prices within the last 3 months prior to renewal. 

As bidding was ceased during the months of April, May, June 2020, the PQP for the months of May, June, and July 2020 will be based on the averages of the QP in January, February, and March 2020 instead.

If your car is in good condition, you may want to consider COE renewal instead of buying a new car.

Forfeiting rebates

Something to bear in mind when deciding whether to renew your COE is that should you decide to follow through, you will be forfeiting your Preferential Additional Registration Fee (PARF) rebate, A.K.A. the scrap value that you would receive if you deregister your vehicle. 

Your PARF is calculated based on the amount of time left until your COE expiration, and the Additional Registration Fee (ARF).

Should I renew for COE for 5 years or 10 years?

If you renew your COE for 5 years, you will have to pay 50% of the PQP, and must scrap your car after the 5 years are up. 

On the other hand, you will have to pay the full PQP amount for a 10-year renewal and you may still choose to renew your COE for another 10 years after that 10-year period expires.

There is a large gap in cost between a 5-year renewal and a 10-year renewal, so you should definitely take your car’s condition and your budget into consideration first.

How do I renew my COE?

There are a few ways you can renew your COE. 

  • Online (6am – 12 midnight daily)

You can renew your COE online here, as long as you have an internet banking account with any of the following banks: DBS/POSB, OCBC Plus!, Standard Chartered Bank, Citibank, UOB (eNETS Debit).

  • By post

If you wish to renew your COE by post, you may do so by mailing this completed online form along with your PQP payment via cheque or Cashier’s Payment to the Land Transport Authority (LTA) Customer Service Centre. Ensure that both your form and payment reach LTA before the expiration of your COE, as it takes about 2 weeks to reach LTA.

At the LTA Customer Service Centre

You may pay by cheque, cash, cashier’s order, Diners Club Card or NETS  if you are paying before your COE expiry. Otherwise, if you are renewing within one month after your COE expiry, only cash, cashier’s order or NETS payment will be accepted. You will also be subject to a late payment fee.

When should I renew my COE? 

While LTA allows car owners to renew their COE 30 days after the expiry date, you should start planning on renewing your COE as soon as possible. Aim to start planning at least 6 months before your COE is due to expire to be safe, and to avoid incurring the late renewal fee.

Each vehicle type is subject to a late renewal fee of varying values, as seen in the chart below by One Motoring.

How should I finance my COE renewal?

There are just as many options out there to finance your COE renewal as there are to buy a car. In fact, most banks and finance companies offer COE renewal loan plans if you do not want to fund your COE renewal by yourself. 

You can even get a loan that covers the entire cost of renewal, unlike car loans which usually only cover up to 70% of the cost. Of course, different banks and companies have different interest rates and policies, so be sure not to skimp out on doing your research thoroughly.

(Related Story: Important Things To Know Before Scrapping Your Car)

So, should you renew your COE instead of buying a new car? The truth is, there are pros and cons with either option. This is why you should consider all the aforementioned points carefully and make sure that COE renewal is right for you before coming to a decision.

(Related Story: LTA Vehicle Ownership Transfer And Deregistration: A Step-By-Step-Guide)

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