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Road tax changes - guidance for dealers

Motoring law firm Lawgistics has put together a Q&A detailing the most frequently asked questions on the new Road Fund Licence (RFL) changes, with answers from the Driver and Vehicle Licensing Agency (DVLA).

October 1 was 'D-Day' for the RFL changes - here is a selection of the most asked questions, as answered by the DVLA.

Q. Given that paper tax discs no longer need to be displayed from the 1st October how will a vehicle repairer know if a car is taxed for the purpose of test drives?
A.
Check at www.gov.uk/check-vehicle-tax but if in doubt as to the vehicle tax status use trade plates for day to day business otherwise an unsuspecting repairer may be prosecuted for driving an untaxed vehicle.

Q. At what point does it become the responsibility of a new owner to tax the vehicle?
A.
As soon as the customer purchases a vehicle and decides to become the registered keeper on DVLA records they must tax immediately. They do not need to wait for the Registration Certificate (V5C) to be in their name to tax.

Q. If a car dealer is sitting with cars in stock with current and valid tax, what happens to the tax on 1st October since these cars will be ‘in trade’ and have no current keeper?
A.
Any vehicle currently in the motor trade with a valid tax disc will continue to be taxed until the vehicle is sold. At that point the present tax will terminate. No refund will be paid where the vehicle is recorded as in the motor trade. For any refund to be issued there must be a registered keeper held on DVLA records. This has been the case since 2009.

Q. Can car dealers continue to tax vehicles for customers on their behalf?
A.
Yes, by using V5C/2, either online at https://www.gov.uk/tax-disc using the V5C/2 of the V5C, by telephone on 0300 123 4321, or at a PO branch that deals with vehicle tax.

Q. How will the tax change affect vehicle auction companies?
A.
Vehicles transferred to an auction company will be untaxed from 1 October. Once the seller informs DVLA that they have sold the vehicle they will receive an automatic refund. The buyer will need to tax the vehicle using V5C/2 before they drive it away from the auction house, online or by phone as noted above.

Q. Can dealers use existing stock as ‘staff cars’ if they retain a valid tax disc?
A.
No, dealers will have to register in their own name and tax the vehicle. Dealers have always been required to register vehicles in their name if they wish to use them for staff or personal reasons. If used for a valid ‘trade plate’ reason, then the current trade plate rules apply and the vehicle does not need to have tax. For further information go to https://www.gov.uk/trade-licence-plates .

Q. Do existing paper tax discs issued need to be visible from 1 October?
A.
No.

Q. Can we perform a change of keeper online?
A.
Not yet, but DVLA will introduce this soon. As noted above you do not need to be the registered keeper to tax. From 1 October you can use the new keeper supplement of the log book.

Q. When can we pay car tax by direct debit?
A.
Starting from 1st November 2014.

Q. If a registered keeper does not apply for a refund when selling a vehicle to a motor trader before October will an automatic refund be issued for the remaining duty once DVLA is notified of a new keeper after 1 October?
A.
Yes, an automatic refund will be issued to the previous keeper once a new keeper notification is received after 1st October.

Q. Do cars in dealer stock, which are not taxed need to be SORN?
A.
No, if registered ‘in the trade’ and kept on private land then SORN is not required. Trade plates can be used to demonstrate a vehicle.

Q. Can we legally drive a car to an MOT testing garage without tax?
A.
Yes, providing the MOT test is pre booked.

Q. If a car is currently marked in trade and has a valid tax disc until sometime in 2015 will that tax be valid if the car is sold after October 2014?
A.
No, the existing tax will terminate on the day the car is sold after 1st October. Any refund of tax will be issued to the previous keeper. If the trader wishes to receive the refund, they must have registered the vehicle in their name before 30th September.

Q. Is there any way for a dealer to check whether a car is ‘in trade stock’?
A.
There is currently no way for a dealer to check this. DVLA are aware of vehicles held in trade stock and are investigating how that information might be made available to dealers.

Q. What is the fine issued to a registered keeper for using a vehicle without valid tax?
A.
Up to £1000.

Q. What is the method when selling a PX/trade car to a trader that is not being taxed in their name?
A.
The process is unchanged. There is no need to notify DVLA. Trade plates should be used if the vehicle is used on the road for test drives, delivery etc. There is no requirement for a dealer to tax a vehicle in their stock unless they want to use it for example as a staff car.

Q. Since trade discs are to cease can we 1) remove the triangular and destroy the tax disc from 1st October as with standard tax discs, and 2) remove the screw held triangle top section from the front of the plate?
A.
Yes, there is no requirement to display anything in the triangular holder after the 1st October.

Q. Can a car currently taxed and ‘in trade’ be parked legally on the road?
A.
No, a vehicle must be registered to a keeper and be taxed before it can be parked legally on the road. If the vehicle is notified as ‘in trade’, the vehicle must be used for day to day business under the cover of trade plates.

Lawgistics is taking additional questions on the subject here.



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Comments

  • David Morgan - 08/10/2014 17:40

    Do I need to return my current tax disc which is registered as disabled and has several months left as I have changed my car and registered the new one.

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    • David Morgan - 08/10/2014 22:14

      T@David Morgan -

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  • Sir John Haffenden - 08/10/2014 22:10

    I have bought a car and need to drive it home its the 8th of the month and I will have to tax it from the first is this ok to drive.

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  • Debbie - 09/10/2014 16:21

    If you have bought a car and paid for the tax online on the 13th of September, however never received a tax disc can you get a refund after purchasing a 6 month tax amount online, so say I sold my car, could I get the 5 months tax back?

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  • Helen Whiteside - 09/10/2014 17:01

    I have scrapped my car. Will I get the 3 months tax back.

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  • Peter Lightwood-Clark - 10/10/2014 09:17

    If I'm buying a car from a private seller and It still has a valid road tax do I still have to apply for new road tax

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    • gezza06 - 13/10/2014 12:44

      @Peter Lightwood-Clark - Yes you do as the previous owner will automatically get refunded by DVLA when they receive the part of the V5.

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  • peter - 10/10/2014 14:22

    If i tax a car for the new owner and his part exchange has a personalised number on it what is the quickest procedure to enable the customers new car to be taxed and apply for the plate transfer. and can it be done on line.

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  • Daniel-Jack Williamson - 10/10/2014 17:32

    It's not called Road Tax.. Just saying...

    Maybe you should get your facts right before posting an article.

    No wonder people keep spouting the whole "you cyclists should pay road tax" garbage! (What, go back to the 1930's when Road Tax EXISTED?)

    Idiots.

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  • arfan - 11/10/2014 17:54

    Dose the car need to be registered in the keepers name to be taxed ?

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  • jeremybennett - 14/10/2014 10:47

    The last line of the article includes a link to the Lawgistic's website where it will provide answers to readers' questions.

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  • John - 26/12/2014 09:06

    Really annoyed. I set up direct debit to pay my car tax.
    Some problem caused it to fail. Enough money in bank so not that.
    Come Christmas morning i check my tax online and it's not valid where it was Christmas Eve.
    New Keeper Supplement already used so can't reset direct debit using it.
    Still waiting for logbook.
    Don't have enough money to pay for full year tax yet.
    Want direct debit set up but it won't allow me to set it up.
    If i use car to go to post office i am at risk of being stopped for no tax.
    Ridiculous that New Keeper Supplemet can't be used more than once.

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  • JOHN HODGETT - 12/01/2015 16:15

    Can you Tax Trade plates online ?

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  • Phil Sidebottom - 29/01/2015 18:58

    What a bloody dogs breakfast this has turned out to be. Only a brain dead Government employee could invent a scheme like this.

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  • t. jones - 30/01/2015 23:18

    can we transfer the tax from one car to another, the road tax is paid monthly

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  • Keith Bean - 02/02/2015 08:16

    Information regarding dealers driving untaxed vehicles was extreemely clear as were other points that were explained on the website.

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  • Mr Lester - 04/02/2015 17:58


    How were the public made aware that a buyer of a used care is liable for tax as soon as they take ownership. Bought a used car in good faith October 2014 with a tax disc valid until Feb:2015 (the cost of car included the tax still valid). At no time was aware that I was required to retax the vehicle. DVLA has sent "Unlicensed Vehicle" with a fine. I find this quite amazing as the advice to the public seemed negligible.

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  • Keith Phillips - 19/02/2015 13:18

    If i pay for a 12month tax RFL and not use the car for a period of 4 months, am i entitled to a refund

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  • Keith Phillips - 19/02/2015 13:18

    If i pay for a 12month tax RFL and not use the car for a period of 4 months, am i entitled to a refund

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  • Robert Driver - 26/02/2015 16:19

    I am about to buy an untaxed and un-sorned car. The tax expired last October. When I come to tax it will I be liable to the unpaid amount?

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  • Simon - 02/04/2015 19:51

    I thinking about buy a used car if I taxs the car.and it in the old keeper name Do the taxs get refund to

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  • Jane Burt - 16/04/2015 06:15

    My partner is buying a car on HP. It was taxed by the garage he purchased it from. I am now the registered keeper of the vehicle and have had to pay for new road tax. However I am not the owner, my partner is as the HP is in his name. Should I have been made to re tax the vehicle?

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  • Steve Edwards - 25/04/2015 10:35

    I am thinking of buying a used motorhome which doesn't have an mot and is sor, to enable me to get it to a garage for the pre mot work to be carried out, can a motor trader use his trade plates for the purpose of taking the vehicle to his garage.

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  • Sarah Smith - 22/05/2015 21:35

    I have got married and car was taxed in old name and changed my ownership details is my car tax valid? Thanks Sarah

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  • Mike ratz - 25/05/2015 10:57

    Just scrap the whole tax thing & put it on the fuel duty, the more you use, the more you pay. If the lost revenue from tax dodgers is taken into account it shouldn't be excessive Have insurance & MOT "discs" in the windscreen.

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  • Josie saunders - 01/06/2015 19:35

    My partner had our car in his name, he has now Put it in mine , is my tax still legal

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  • elizibeth martin - 18/08/2015 09:16

    If someone he a traders policy does it entitle them to drive around in untaxed and no mot

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  • Kevin Cheshire - 24/01/2016 19:34

    1 want to cancel my monthly direct debit car tax for my ex girlfriends car, what do I have to do?

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  • laura - 06/03/2016 22:08

    Have brought a car and waiting for v62 to be prossessed have sent 6 months tax as well can I insure the car and drive it before I receive the documents ( 6 to 8 weeks)

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    • John Higginbotham - 15/09/2016 10:22

      Depends whether the place you brought it to is accessible without travelling on the public highway. If you want to bring it there by road, then it'll need to have valid VED. However, as the VED payment will be visible within minutes on the MOT check website, you needn't worry about driving it. I'm assuming that when you talked about bringing the car from one place to the other, you meant on a trailer or by some other means not including driving there?

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  • Ian - 21/07/2017 07:30

    I have left my car with a local dealer who is going to sell it for me but I remain the registered keeper on the V5 and have not transferred or sold the vehicle to him. The car is still taxed in my name so can I apply for a refund on the VEL for the remaining period?

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  • douglas munday - 17/11/2017 13:55

    I wonder if you are aware that under the registration and licencing regulations 2002, a dealer who has had a used car in stock for more that ninety days, (not unusual,) is required by law to register the vehicle in their name, and then re not permitted to use trade plates on that vehicle, even for example, to carry out a test drive, but must instead tax the car. There are serious implications to this legislation, the two most worrying in mind mind, being that it can take up to six weeks for a V5 to be processed by the DVLA, during which time the car cannot be sold as it cannot be taxed; the second being that a great number of insurance companies no longer automatically include 'drive other car, cover,' in their policies, which means that a prospective customer would not be insured when driving such a vehicle. In the case of drivers under twenty five, a great number of whom are in the used car market, it is pretty much a given that his cover would be included; ergo, the car becomes virtually unsaleable, unless the dealer is prepared to flout the law. Perhaps something you could take up the cudgels on?

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