Adjusted Early Turnover Scheme: Here's What You Need to Know

Want to replace your existing commercial vehicle with a new one, and get incentives for it?

With the Adjusted Early Turnover Scheme (ETS) that was announced earlier this year, it seems that you really can have your cake and eat it.

This reworked initiative, which is currently ongoing till 31 March 2025, is designed to attract owners of existing Euro II, III, and IV Category C diesel vehicles. And if you happen to own any one of these vehicles, a discounted Prevailing Quota Premium (PQP) is applied on a more eco-friendly replacement, which means you no longer have to bid on a new COE when you're shopping for a new ride.

Consequently, any existing COE rebate from your older vehicle will be transferred to the new vehicle's COE value.

How do I benefit from this Adjusted Early Turnover Scheme?

Under this Adjusted ETS system, you get to enjoy the highest incentives when you change to a new Light Commercial Vehicle – otherwise know as LCV – without tailpipe emissions. This also means that if you choose one with tailpipe emissions, the incentives given are lower.

According to the Land Transport Authority (LTA), eligible existing vehicles should fit the following criteria:

1. a Category C vehicle,
2. not COE-exempted,
3. propelled by diesel, diesel-Compressed Natural Gas (CNG) or diesel-electric engines,
4. under the permanent ownership of the registered owner,
5. registered between 1 January 2001 and 31 December 2013, and deregistered between 1 April 2023 and 31 March 2025,
6. properly disposed of (i.e. scrapped or exported) before the replacement vehicle is registered, and COE rebate, if any, is successfully granted,
7. have at least 1 day of unused COE or at least 1 day of its 20-year lifespan remaining when it is deregistered;

Replacement vehicles share Points 1 and 2 as described above, plus the following:

1. a vehicle that meets Euro VI or equivalent emission standards,
2. classified as Band A or Band B, if it is covered by the CVES (if the replacement vehicle is classified as Band C, it is not eligible to be registered under the Adjusted ETS),
3. registered under the same owner as the existing vehicle,
4. registered within 1 month of the deregistration date of the existing vehicle;

Additionally, the LTA states that the last day to deregister is 31 March 2025. A replacement vehicle must be registered by 30 April 2025, in order for you to enjoy the benefits.

And how is the Prevailing Quota Premium (PQP) calculated?

By going through with the Adjusted ETS, you stand to benefit from a discounted PQP. But how exactly is that calculated? Get ready to put your thinking cap on, because it's about to get very mathematical up in here.

The formula is as follows:

PQP at registration/10 years x (10 years - Remaining unused COE of existing vehicle at deregistration if any - % of remaining 20-year lifespan of existing vehicle at deregistration if any)

To illustrate this, here is an example from OneMotoring:

Details of existing vehicle at deregistration:

Remaining unused COE period = 1 September 2023 to 31 August 2026  = 3 years 

Remaining 20-year lifespan = 1 September 2023 to 31 August 2026  = 3 years

Bonus COE period: 40%

And if we follow the formula shown above the example,

Discounted PQP payable for replacement vehicle at registration: 

= $30,000/10 x [10 - 3 - (40% x 3)] OR $30,000 x 10%; whichever is higher

= $3,000 x [10 - 3 - 1.2] OR $30,000 x 10%; whichever is higher

= $3,000 x 5.8 OR $30,000 x 10%; whichever is higher

= $17,400 OR $30,000 x 10%; whichever is higher

= $17,400

Value of the 10-year COE of the replacement vehicle after registration:

= Discounted PQP paid at registration of replacement vehicle + COE rebate of existing vehicle at deregistration

= $17,400 + (3/10) x $8,000

= $17,400 + $2,400

= $19,800

Under the CVES scheme for registering a Band A LCV, the vehicle owner would also qualify for a CVES incentive of $15,000.

That's a lot of math! Is there an easier way of crunching the numbers?

Unless you've been religiously hitting those Ten-Year-Series Math books well beyond your schooling years, you're not expected to memorise this needlessly complicated formula by heart. 

Which is why there's a useful calculator available on the OneMotoring site here, making the process a lot less troublesome. You are only required to key in the owner and vehicle details, and ensure that you meet all set criteria for both your existing commercial vehicle and its replacement.

Conclusion

And now, you are equipped with a better understanding of how the Adjusted ETS system works, and how you can stand to benefit from it not just from a financial sense, but also knowing that you're doing your part to create a cleaner, more eco-friendly motoring society here! 

Happy driving, fellow Motorist!

Photo Credits: Muhammad Mu'tasim (@mutasimdrives) & ACUBE Creative (@weareacube)

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