What Is The Cost to Own A Car In Singapore 2022 – Average Car Price, Maintenance Cost, Monthly Fuel Expenses

What Is The Cost to Own A Car In Singapore 2022 – Average Car Price, Maintenance Cost, Monthly Fuel Expenses


A car is a large purchase that most people cannot afford to pay for in cash.

According to Business Insider, the average car price in Singapore is approximately five times more than that in the US. The cost to own a car in Singapore goes beyond the first purchase fee – think monthly fuel (ahem, rising petrol prices) and maintenance expenses.

In this article, we’ll take a look at how much money you need in the bank to own a car, other costs you have to bear as a car owner, and tips on how to bring down your overall expenses.  

Is It Expensive To Own A Car In Singapore?

In all honesty – yes, the cost to own a car in Singapore is comparatively higher than in most other countries.

Put aside car prices, many factors such as taxes go behind the cost to own a car in Singapore. Let’s look at some of them. 

Purchase Costs

The purchase cost is the starting point for evaluating the cost of owning a car in Singapore. If you’re thinking of getting a car, suffice to say you should be comfortable with this amount at least.

Market Price

A market price or the Open Market Value (OMV) is the price of a car in the open market. For this article, let’s use a Seat Arona Style 1.0 as an example. At this time of writing, this 5-seater ride has an OMV of $19,363. 

This price is the starting point for calculating taxes and other levies that are applicable to the car.

Certificate Of Entitlement (COE)

The Certificate of Entitlement (COE) is a certificate issued by the Land Transport Authority (LTA) in Singapore.

The COE grants vehicle owners the right to own and use a vehicle in Singapore for 10 years. After which, the vehicle must be either exported out of Singapore or scrapped. Car owners who wish to continue driving their vehicle must renew their COE. 

COE prices vary depending on your vehicle type and engine it requires – a Seat Arona carries a 999 cc engine, which equals to a COE of about $87,889 at time of writing. 

One-Time Registration Fee

All car owners in Singapore must register their car and pay a registration fee. The standard amount of $220 is levied for cars.

Additional Registration Fee (ARF)

The Additional Registration Fee (ARF) is based on the OMV of the car and can range from 100% to 220% of the OMV for new cars.

Here is the latest breakdown of ARF rates as stated by LTA for cars bought after February 2022.

  • 100% of OMV for the first $20,000 Vehicle OMV
  • 140% for next $30,000
  • 180% for next $30,000
  • 220% for OMV above $80,000

The ARF of a Seat Arona is 100% i.e. $19,363

License Number Price

Vehicle Registration Number (VRN) is a mandatory requirement for all cars in Singapore. A VRN is essentially a car plate number. 

There is no charge for a VRN assigned by LTA. However, if you wish to have a VRN of your choice, you must bid for it before registering your vehicle. 

The minimum bid amount is $1,000. 

Excise Duty

Cars imported into Singapore are taxed 20% of their OMV. 

This excise duty is applicable for both new and used imported cars. Here, our Seat Arona will have an excise duty of $3,872 (20% of $19,363). 

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Goods And Services Tax (GST)

The Goods and Services Tax (GST) is a value-added tax that adds a significant amount to the cost of owning a car in Singapore. 

The GST rate for cars in Singapore is 7%. The good news here is that GST is levied only on the OMV and excise duty.

GST of a Seat Arona: $2,116.45. 

Vehicle Emission Schemes (VES)

The Vehicle Emission Scheme (VES) will rate vehicles based on their emissions, with lower-emitting vehicles receiving rebates when they are registered or re-registered. 

The scheme rebates or surcharges a certain amount depending on the vehicle’s emission levels. 

Seat Arona, luckily, has a rebate price of $-10,000.

After all the fees and surcharges issued by the government, the total cost of owning a Seat Arona adds up to $122,833 minimally. 

Next, let’s look into ‘miscellaneous’ costs. 

Maintenance Costs

In addition to initial purchase costs, owning a car also means setting aside money every month for maintenance and repair costs.

Here are a few expenses that add up to a car’s cost of maintenance in Singapore 2022.

Fuel Cost

Be it petrol, diesel or even electric vehicles, all cars will incur some fuel cost. The amount of fuel consumed will depend on the car’s make, model, and your driving habits.

Let’s assume you drive 30 km per day with a mileage of 20km/l. Petrol is $3/l.  

That would be 45 litres of fuel every month, and your average fuel consumption per km will be 0.05 l. 

Monthly petrol cost: $135

Servicing Costs

Depending on the make and model of your car as well as driving habits, you will need to service your car anywhere from every 10,000 km to 20,000 km driven or every 6 months (whichever is earlier). 

These servicing sessions are essential for to: 

  • Keep your car in good running condition
  • Avoiding larger, more expensive repairs down the road

Assuming our Seat Arona here is quite new, the car servicing Singapore price sits at around $250 for every 6 months. On average, this spreads out to a monthly cost of maintenance of $42. 

Monthly maintenance cost: $42

Parking Costs

The cost of parking in Singapore depends on the location, duration, and type of parking.

For example, parking at HDB car parks is usually cheaper than parking at malls or other commercial buildings which could be $100 per month on average.

Road Tax

All cars used on public roads in Singapore must be registered with the Land Transport Authority (LTA) and have a valid road tax. 

It is part of the cost of owning a car in Singapore and is renewed annually. 

How Much Is The Road Tax In Singapore?

The amount of road tax you pay depends on: 

  • The engine capacity of your car
  • The age of the vehicle

The road tax for Seat Arona is approximately $165 per year ($14 per month). 

In addition to the regular road tax, there is an annual road tax surcharge for vehicles older than 10 years. This extra tax surcharge is 10% of your current road tax and will increase every year. 

Electronic Road Pricing (ERP)

ERP rates depend on the time of day and location. Presently, it is around $3 to $6. 

For this article, we’ll work with an ERP rate of $30 per month. 

Insurance Costs

Driving a car without an insurance policy is illegal in Singapore. Insurance will protect you, as well as other road users, in the event of an accident.

For a relatively new car, you pay about $1,600 per year ($133 per month).

Total monthly maintenance cost: $454. 

Hidden Costs

Apart from the costs outlined above, there are other hidden costs of owning a car in Singapore that many people don’t take into account.

Cost Of Depreciation

Depreciation is the loss in value of your car over time due to wear and tear, as well as obsolescence.

Cost Of Financing

If you’re taking out a loan to finance your car purchase, you’ll need to factor in interest. This can add a significant amount to the overall cost of car ownership. Say you are going to pay 30% of the purchase value and borrow the remaining 70% ($85,633) at 2% interest p.a for the tenure of 6 years. 

This would add up to $142 interest per month.

Fines Incurred

Singapore is known to have one of the harshest laws in the world, and this includes driving laws. Break a traffic law and be prepared to meet with a fine. 

These fines can add up over time; let’s say it is $30 per month give or take.

This gives us a total hidden cost of $172.

The total cost of owning a car in Singapore now can be broken down to:

  • One-time (purchase) cost – $122,833
  • Recurring cost or the monthly cost of owning a car in Singapore – $626 per month

How Much Should I Borrow? 

As a general rule of thumb, your car loan installment should not exceed 10% of your monthly income.

Note: This is just a guideline and you should ultimately make a decision based on your financial situation, the car you wish to buy, and your ability to repay the loan.

How Long Should My Loan Tenure Be? 

The average car loan tenure in Singapore is about 5 years. The car loan tenure is set up only for the first 10 years of the car’s age because of the COE system.

When choosing tenure, it’s important to strike a balance between affordability and the total amount of interest you’ll pay as the longer the loan tenure, the lower your monthly installment will be.

What Are My Car Finance Options?

In order to handle the costs of owning a car in Singapore, there are various car financing options available in the market.

Car Dealer’s Financing Options

If you’re buying a car from a dealer, they will very likely offer you in-house financing. In-house financing is provided by the dealership and typically has higher interest rates than other options.

Loans From The Car Dealer

Some car dealers will give you an option to take a loan from traditional banks. If you prefer the security and comfort of taking out a loan from a registered institution, this might be a better option for you.

Direct Bank Loans

Alternatively, you can also directly approach the bank for a loan. The advantage of doing this is that you can shop around for the best interest rates and terms.

Car Loan Interest Rates In Singapore

The interest rate on your car loan will have a big impact on the total cost to own a car in Singapore.

  • 5% for in-house loans 
  • 2% to 5% for certain financial institutions 

As your loan tenure increases, your monthly installment will be lower – so we recommend checking out the interest rates from different car loan providers before making a decision.


To sum it up, the cost of owning a car in Singapore can be quite expensive. Most people will likely have to take out a loan. 

If you’re mindful of all the costs involved and are ready to take this next step of your life, here at Money Kinetics we are more than happy to help you find a personal loan that matches your needs.