Selling a Car Pay Tax Again
The procedure for paying road tax when ownership a used car in the United kingdom of great britain and northern ireland changed two years ago, yet information technology still causes confusion among motorists today. Nosotros've updated this article from 2022 to bring yous an up-to-date caption of how it all works.
Before October 2014, a used automobile could exist sold with any existing road taxation (officially known as vehicle excise duty or VED) being carried over to the new possessor. So if you bought a machine which withal had 3 months of tax left, you didn't have to renew information technology for 3 months.
It was simple, straightforward and everybody understood how information technology worked. Then manifestly the DVLA decided to completely screw the whole thing up.
Starting in October 2014, road revenue enhancement no longer carries over when yous buy or sell a used machine. Instead, the new owner has to purchase route revenue enhancement before taking possession of the vehicle from the previous owner.
Understandably, this creates more hassle for buyers, as you have to either get online or call the DVLA and pay road revenue enhancement before you can bulldoze off in your motorcar – fifty-fifty though the previous owner has already paid route tax for the vehicle.
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Because the DVLA is antiquated and unable to cope with the 21st-century world we live in, it is just able to process road tax on a monthly or annual basis. And then if you buy a used motorcar on the 15th of the month, y'all have to pay road tax for the whole month.
Merely the previous possessor volition not exist refunded for road tax already paid for that month. Therefore the DVLA has finer double-taxed the vehicle for that month.
Even if you're giving your car to another family member at the same address, the tax won't bear over. Both buyer and seller have to tax the car for a full month each time a used car is sold or transferred.
More eight million used cars are sold each yr in the UK. Obviously not all of them are already taxed at time of buy, but it even so means that the DVLA is finer stealing millions of pounds from British motorists each year by double-taxing sold used cars for a month.
Road tax when selling a motorcar: what do you lot need to practise?
Since you can't sell a car with route tax anymore, the existing tax will exist cancelled equally soon as the DVLA processes your notification of the ownership being transferred.
Equally a seller, y'all need to notify the DVLA immediately when y'all sell your auto (or transfer ownership) to someone else. You lot will only receive a refund for any whole months of route tax outstanding, and so if y'all sell your car on the first of the month and so you lot notwithstanding have to pay for that full month of road tax.
Unlike practically every other arrangement on Earth, the DVLA can't grasp the concept of billing by day rather than past month. It's perfectly happy to rip off British motorists with the government's blessing.
If y'all fail to notify the DVLA that y'all are no longer the registered keeper of the vehicle, you lot could be fined up to £1,000.
Route tax when ownership a car: what practice you demand to do?
When you buy a used car, you must pay road tax before driving off in the vehicle. Even if your motorcar is just parked in the street, you must pay route revenue enhancement.
Y'all can pay your route revenue enhancement:
- Online (24 hours),
- Past phone on 0300 123 4321 (24 hours)
- At a mail role (during business hours only, and not every post office handles vehicle tax).
Unhelpfully, you as well can't set up a direct debit over the phone; only online or in person.
If you fail to pay the DVLA before driving abroad, you could be fined £lxxx, or a maximum £1,000 if the fine is not settled within 28 days. And of class, y'all won't be insured if you're not taxed.
No road tax = no insurance
If your car is not taxed then it will also not exist insured (unless you lot are driving it directly to an MOT station). Then not only are you liable to exist fined, just if y'all are involved in an blow or have your car stolen, your insurance will non be valid.
If your scrap or export your car, you need to notify the DVLA and a utilise for a Statutory Off Road Notification (SORN). This remains applicative as long as the car is off the road. However, you can't put the car back on a public route – even if it'south merely parked on the street – until y'all pay road taxation again.
How are route taxation transgressions enforced?
When irresolute the 2022 road tax rules, the DVLA decided to do away with the familiar circular taxation discs, which previously had to be displayed in every motorcar's windscreen. And then information technology's no longer possible for a policeman to notice the tax disc on your car is out of date and whack you with a fine. However, that very rarely happened anyhow.
Today, road tax checks are all done electronically. Police use Automatic Number Plate Recognition (ANPR) cameras to catch owners of untaxed vehicles on the road, and have been doing so long before the tax disc was taken out of circulation.
The DVLA makes vehicle database checks on vehicles every month. It tin clamp your vehicle if you haven't paid your road tax, and and so strength you lot to pay a release fee of £100 to be unclamped. Alternatively, your auto may be impounded. That ways you'll have to pay a fee of £200 to release your motorcar – and prosecution costs and fines may also apply.
Initial anarchy has at present subsided, only at a cost
Predictably, turning a perfectly simple and sensible arrangement into a far more complex one caused widespread anarchy throughout the UK. Many thousands of used car buyers were caught out by the changes, and many motor traders were confused past the changes too.
This resulted in many used cars going untaxed for several months until owners realised (usually well-nigh the fourth dimension their insurance or side by side route tax bill was due).
Organisations including the RAC warned that the number of untaxed cars would skyrocket under the new system. Still the DVLA rubbished those claims, describing them as "nonsense". Then no-one was surprised (except the DVLA, presumably) when that's exactly what happened.
The number of unlicensed vehicles more than than doubled in the year afterwards the new rules were introduced, with more than 560,000 untaxed vehicles costing the country a claimed £fourscore one thousand thousand. What'south more than, two years later it appears that the organisation is still failing, with hundreds of millions of pounds lost.
Conspicuously, the massive increase in untaxed vehicles is unlikely to be the result of hundreds of thousands of motorists suddenly deciding to get VED-dodging criminals. The figures propose that the arrangement is at mistake. Of form, getting the DVLA to accept its failure is unlikely.
There's too the probability that at to the lowest degree some of the increase is downward to vehicles no longer carrying tax discs in their windscreens, and so owners are less likely to notice if their taxation has expired.
The DVLA claimed that doing abroad with tax discs would save the state millions. But so far it looks like it has lost far more it saved.
This article was first published in September 2014 and has been updated in October 2022 to reverberate the number of questions we continue to receive about the workings of the UK vehicle registration process.
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Source: https://www.thecarexpert.co.uk/what-happens-to-road-tax-sell-car/
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