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Claiming car tax refunds

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Claiming car tax refunds

Once upon a time, when you were trying to sell your vehicle, you were able to make the deal more appealing on account of how many months worth of road tax your car had left on it. A 12-month tax disc on a vehicle would net the seller several hundred extra pounds, while a discount could be negotiated by buyers on vehicles which would require road tax renewal within a couple of months. However, today this is no longer the case. In the event that the vehicle you are selling still has outstanding road tax, the remaining amount can now simply be paid back to you by telling the DVLA that you are no longer the owner of that vehicle. The same is true if your car is no longer on the road, exported or registered as tax exempt. Your car’s new owner will have to re-tax the car straight away, which means it is crucial that you inform the DVLA that the car is no longer yours immediately, or you risk a £1000 fine.

Claiming car tax refunds

Once upon a time, when you were trying to sell your vehicle, you were able to make the deal more appealing on account of how many months worth of road tax your car had left on it. A 12-month tax disc on a vehicle would net the seller several hundred extra pounds, while a discount could be negotiated by buyers on vehicles which would require road tax renewal within a couple of months. However, today this is no longer the case. In the event that the vehicle you are selling still has outstanding road tax, the remaining amount can now simply be paid back to you by telling the DVLA that you are no longer the owner of that vehicle. The same is true if your car is no longer on the road, exported or registered as tax exempt. Your car’s new owner will have to re-tax the car straight away, which means it is crucial that you inform the DVLA that the car is no longer yours immediately, or you risk a £1000 fine.

Road tax refund limits

Once you have done this, your tax will be automatically cancelled and any remaining full months will be refunded. Direct Debit payments will also stop and a cheque for the amount to be refunded will be made out and mailed to the address specified on the car’s V5C registration document. The amount that you receive is calculated from the date of cancellation, making it all the more important that the DVLA is notified of the change of ownership as soon as possible, to avoid unnecessarily losing a month’s worth of money. However, credit card payments, Direct Debit surcharges, or the 6-month one-off road tax payment 10 percent surcharge will not be refunded. Fully electric vehicles worth less than £40,000, or those which are more than 40 years old, do not require road tax, so they do not qualify for any form of road tax refund.

How long before the refund arrives?

A cheque for the road tax refund should arrive no later than six weeks after notifying the DVLA of the car ownership change. If the refund fails to materialise after this length of time has passed, you will need to get in touch with the DVLA tax enquiries department. The DVLA can be contacted either:

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