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OCT 8, 2014

Car tax goes digital

The DVLA have recently implemented a change to the way car tax is purchased and applied. Previously a paper car tax disc had to be purchased annually or biannually and displayed in the bottom left of the front windscreen of your vehicle. However, from October 1st 2014 the circular paper tax discs are no longer being issued. The theory behind the change is to make it easier for vehicle owners to pay for their road tax; let’s look at it in a bit more detail...

What does the change mean for me?

The new system isn’t being phased in slowly; it is in place now. Next time you renew your car tax you won’t need to obtain and display a paper disc. In fact, even if your current tax disc is still in date you no longer have to have it on show in your car!

But before you get ahead of yourself, this change does not mean you won’t have to pay your car tax! The DVLA will send you a reminder when your road tax is due for renewal; you can then choose to pay it online or at your local Post Office.

The price bands for road tax remain unchanged and the option of paying upfront for 6 or 12 months tax is still available. However, from November 1st there will also be the option to pay your road tax monthly by Direct Debit. Paying monthly will be 5% more expensive than paying for 12 months up front, which is still less than the 10% surcharge incurred by those paying for 6 months tax.

Choosing to pay by Direct Debit means that the DVLA will continue to take the payments each month until you tell them to stop, leaving you free for more exciting things like remembering to book your car in for MOT or service....

What happens if I sell my car?

Under the old system any pre-paid car tax would be transferred over to the new owner when you sold the vehicle. However, under the new taxation system this transfer no longer happens.

Instead, if you sell your vehicle you can obtain a refund on any remaining tax, while the new owner must purchase new tax for the vehicle. Tax refunds are automatically sent to you when the DVLA receives notification that the car has been sold, scrapped, or taken off road with a SORN.

As the seller it is your responsibility to inform the DVLA straight away of a change of ownership, otherwise you could face a fine of up to £1000; and you’ll be liable for any speeding fines or parking tickets incurred by the new owner!

How will car tax be policed?

Traffic wardens have traditionally patrolled the roads visually checking tax discs in car windows to see if they are out of date. However, more recently the use of automatic number plate readers has been used to check whether a vehicle has up-to-date tax or not. The police rely on number plate recognition cameras to catch untaxed vehicles, so not much will change in that respect. 

Created on 8th October 2014
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