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Understanding the Tax disc change-overBack

TaxDisc02From the start of October, the paper tax disc is to be replaced by an electronic equivalent to reduce administration costs dramatically.

It is hoped by the DVLA that the new process will be straightforward for car-owners, but the reality is that it could become quite tricky. The outgoing paper tax disc currently moves with the vehicle, but the new electronic Vehicle Excise Duty (VED) will be non-transferable, and will “belong” to the vehicle’s owner. This means that when a car is sold, it will no longer be taxed and the previous owned will get a refund. The new owner must therefore ensure that the car they have bought is taxed from the minute they drive it off the forecourt.

Below are a few questions and answers which we hope will provide you with more information about the new tax system.

Why is the DVLA making the change?
According to the DVLA, the change to the tax disc system should save taxpayers £10 million the government estimates, with the digital system able to streamline services saving businesses millions of pounds a year in administrative costs.

What do I have to do?
You do not have to do anything until your current tax disc is up for renewal. At that point, you will receive a renewal notice asking you to pay online, by phone or in the Post Office for your electronic tax. The hassle will be further minimised by the introduction of a direct debit option.

How will tax dodgers be caught out?
Number plates will be all the police now need to identify tax dodgers and there will be an online database which includes every car’s tax status next to its registration number. Drivers will also be watched by cameras on the roads and inspectors will be able to access the database from wherever they are. Non-payers will receive warnings when tax is overdue.

Can I sell my tax disc with my car?
No. This is the biggest change to the paper-based tax system. Sellers will no longer be able to transfer tax with the ownership of a vehicle, so anyone who buys a used car will no longer benefit from months left on the tax disc. Instead, buyers will have to renew their tax disc straight away or they will risk being caught out on the road in an untaxed car.

Can I claim the tax if I am the seller?
Yes. When the DVLA has been notified, vehicle sellers will receive an automatic refund for any full calendar months left on the vehicle tax.

Things to remember
If you’re selling your car, make sure you take the old tax disc with you. The Seller of the vehicle is responsible for informing the DVLA of a change of ownership, otherwise they could face a £1,000 fine. For further information visit the DVLA website.

 

Posted by Leana Kell on 10/09/2014