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A Comprehensive COE Renewal Guide for Singaporean Drivers

Here's everything you need to know about COE Renewal in Singapore. Renew for 5 or 10 years? Taking the best COE renewal loan, when to renew your COE and more.


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Understanding PQP, PARF and COE rebates

Why is COE renewal important?

Certificate of Entitlement (COE) renewal ensures that you can continue driving your trusty old car. Otherwise, once your COE expires, you need to deregister your car.

Why should you opt for COE renewal?

COE renewal is an economical choice that involves a much lower upfront cost. You only need to pay for the Prevailing Quota Premium (PQP) to renew your COE.

What is PQP?

PQP is the moving average of the COE prices in the past 3 months. It varies from month to month. To calculate PQP, simply take the existing COE prices of the most recent three months and find its average.

How do I determine if COE renewal is the better choice?

You can calculate your car's deregistration value to understand the financial considerations involved if you don't renew your COE.

How do I calculate my car's deregistration value?

Your car's deregistration value = [COE rebate + PARF rebate]

What is my COE rebate?

COE rebate is based off the Quota Premium paid and the remaining COE left.

Your COE rebate = [(Quota Premium Paid x Number of months left)/120 months].

Example: It is 2021. Adam has 12 months of COE left on his car. Assuming that his Quota Premium (QP) paid back in 2012 was $40,000, the COE rebate he will receive is ($40,000 x 12) / 120 = $4,000

What is my PARF rebate?

Preferential Additional Registration Fee (PARF) rebate is based on the Additional Registration Fee (ARF) value.

Your PARF rebate = [ARF x % based on the age of your car]

ARF is a tax imposed upon the registration of your vehicle, which depends on your car's Open Market Value (OMV). A car's OMV is the original cost of production of the vehicle before surcharges, taxes and the dealer's profit.

Age of vehicle at deregistration PARF rebate (COE May 2002 onwards)
Not exceeding 5 years 75% of ARF paid
Above 5 years but not exceeding 6 years 70% of ARF paid
Above 6 years but not exceeding 7 years 65% of ARF paid
Above 7 years but not exceeding 8 years 60% of ARF paid
Above 8 years but not exceeding 9 years 55% of ARF paid
Above 9 years but not exceeding 10 years 50% of ARF paid
Above 10 years NA

Drivers deregister their cars if they can reap a substantial amount of returns upon deregistration. However, this comes at a heftier price tag as they need to pay more for a new car.

If your car is still in good condition, is relatively accident-free and you've been diligently caring for it, the financially prudent decision would be to renew your COE.

What happens after I renew my COE?

Your PARF car becomes a COE car. PARF cars have both PARF and COE rebates, while COE cars only have COE rebates. That's because all PARF rebates are forfeited upon COE renewal.

Thus, bear in mind that when you deregister your COE car in the future, you will only receive COE rebates.

High and low COE prices, what does that mean for COE renewal?

Rising COE prices means that you need to pay a higher PQP for COE renewal, vice versa. It's best to plan ahead for COE renewal, so you can make a financially informed choice after weighing the pros and cons of keeping your car.

COE Renewal: When and How

When do I need to renew my COE?

You are given up till one month after your expiry date to renew your COE. Until your COE is renewed, you will not be able to drive your vehicle.

Ideally, you should renew your COE when PQP is low. Start monitoring COE prices at least three months before your COE expires. It is recommended that you renew your COE before your existing COE expires - if not you will incur a late payment fee. Do note that renewing your COE right before it expires means that you will be forfeiting any unused portion of your COE.

Vehicle type Late Payment Fee
Motorcycle $50
Private motor car (1,000cc and below) $50
Private motor car (1,001cc to 1,600cc) $100
Private motor car (1,601cc to 2,000cc) $150
Private motor car (2,001cc to 3,000cc) $200
Private motor car (more than 3,000cc) $250
Business service passenger vehicle (company car) $250
Goods vehicle and public service vehicle $250
Others $250

coe renew

How do I renew my COE?
  1. Online via the One Motoring website:
    • You will need to have an internet banking account with either DBS/POSB, UOB, Citibank, Standard Chartered, OCBC.
    • Ensure that you increase your daily limit and have sufficient funds in your bank account
  2. Snail Mail:
    • Complete the application form and mail to Land Transport Authority (LTA) Customer Service Centre 10 Sin Ming Drive Singapore 575701
    • Make the Cheque payable to 'LAND TRANSPORT AUTHORITY' and cross 'A/C Payee Only'. Write your vehicle and contact number on the reverse side of the Cheque.
    • Only cashier's orders are accepted for expired COE renewals.
  3. LTA's customer service center:
    • Complete the application form and submit it with your payment at 10 Sin Ming Drive 575701
    • Make the Cheque payable to 'LAND TRANSPORT AUTHORITY' and cross 'A/C Payee Only'. Write your vehicle and contact number on the reverse side of the Cheque.
    • You may pay by Cash, Cashier's order, NETS or Diners Club Card, Cheque

What costs to expect when you renew your COE

  1. Prevailing Quota Premium (PQP)

    To renew your COE, you will need to pay the PQP to extend the 'life' of your car. The cost of the premium varies according to the COE prices of the previous three months.

    The cost of your PQP also depends on how long you intend to renew your COE for. Premiums for 5 year renewals will be half of 10 year renewals, resulting in lower costs. Consider these questions when you decide on the length of your COE renewal period.

  2. Forfeiting PARF and COE rebates

    Car owners will receive PARF and COE rebates when a car younger than 10 years old is deregistered. Choosing to keep your car and renewing it's COE would mean that you forfeit this rebate.

  3. Increase on road tax

    Your annual road tax will increase yearly by 10% of the car's regular road tax rate (capped at a maximum of 50%)

  4. Limited comprehensive insurance options

    Older cars are deemed more problematic by insurers and are mostly offered third party insurance. Comprehensive cover is offered on a case-by-case basis by only a handful of insurers.

  5. Vehicle maintenance

    A vehicle over 10 years will be increasingly costly to maintain and repair. Send your car for an inspection of your car's condition to get a gauge on your expected cost of maintaining your vehicle.


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Factors to consider before renewing COE

  1. Mileage - A car with lower mileage is likely to have a longer life ahead of it, as compared to a car with higher mileage. The average annual mileage of a passenger car in Singapore is in the region of 17,000km to 18,000km.
  2. Drivetrain integrity - Your drivetrain includes highly complex mechanical components like engine and transmission. If your drivetrain is not showing any unusual symptoms, such as abnormal noises being emitted when you are driving, difficulty in starting the car, or even loss of engine power when driving, then your car is in good condition for COE renewal.
  3. Pre-existing electrical faults - If your electrical systems are faulty, it will cost more to service it more often than usual. Obvious tell tale signs include charging malfunctions, dimming lights and low system voltage. Etc.
  4. Age of Car - Older cars tend to face problems over time, but that's no surprise. Precautionary measures can be taken to mitigate this.
  5. Frequency of maintenance - Cars that have been regularly and properly maintained are in better overall condition. Consider sending your car for regular maintenance so you don't need to worry about it's lifespan.
  6. Availability of spare/replacement parts - Renewing COE of a common car model means you won't to worry about the availability of spare and replacement parts if your car needs it in the future.
  7. Desirability - Some drivers renew COE with the intention to sell their cars in the long-run. If your car is a desirable model, chances are you can sell it off relatively easy next time as compared to the lesser popular models.

Renew your COE for 5 or 10 years?

When applying for COE renewal, you will have to decide between a 5 or 10 year COE renewal period. Ask yourself these questions to determine which is more suitable for you and your car:

Am I prepared financially?

5 year COE premiums are cheaper than 10 year COE premiums by half. Review the financial commitments that you have in your life to make a sound decision.

Your COE renewal repayment period also differs. Ten-year COE renewals can be repaid over seven years, while five-year COE renewals can be repaid across five years.

Do also take into consideration that the road tax surcharge for COE cars with larger engines are more significant.

How long do I intend to drive my car?

If you opt to renew for 5 years, your car MUST be deregistered after 5 years. It's COE cannot be renewed any further.

If you opt to renew for 10 years, you are eligible for unlimited COE renewals thereafter.

Will my car last for the next 5 or 10 years?

Ensure that your car is in good condition to last you an additional 5 or 10 years. Send your car for an inspection to determine its overall condition before you make your decision.

Taking a loan for COE Renewal

Bank COE renewal car loans

Banks offer transparency, decent interest rates and do not charge pricey administrative fees. Bank loans are also tedious to secure because loan eligibility is based on your credit score. Additionally, the process for approval takes a few working days.

Do note that banks don't do direct COE renewal loan applications. You will need to go through an agent.

In-house COE renewal car loans

In-house COE renewal loans offer a higher interest rate when compared to banks. It starts at 3% and can go up to 4%, depending on the loan amount and tenure. However, some exceptions include promotional interest rates (as low at 1.88%) and higher administrative fees.

In-house loans are approved faster than bank loans because credit checks are not done. Should credit assessments be done, and you have a poor credit rating, it rarely affects chances of securing your COE renewal loan.


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