Getting a car tax refund
If you’re selling your car or taking it off the road, what happens to any unused car tax?
It’s pretty simple. Just let the DVLA know you want to cancel your car tax and they’ll automatically send you a car tax refund for any full months left.
Here’s what you need to know about getting a road tax refund.
If you’re selling your car or taking it off the road, what happens to any unused car tax?
It’s pretty simple. Just let the DVLA know you want to cancel your car tax and they’ll automatically send you a car tax refund for any full months left.
Here’s what you need to know about getting a road tax refund.
What is a car tax refund?
A car tax refund (or road tax refund) is money back on any vehicle excise duty (VED) that you’ve already paid.
Road tax is not transferable to a different vehicle or a new owner, so if you no longer own a car you’ll need to notify the DVLA. They’ll automatically give you a refund for the remaining road tax.
For example, if you paid your car tax for the year but you sell your car after only three months, you’ll be able to reclaim most of the tax.
You can get a DVLA tax refund on full months, not partial months, so apply for your refund as soon as possible to avoid missing out.
Top tipBe aware of scammers posing as the DVLA. Fraudsters love to lure unsuspecting victims with false websites, links and messages, and they often send them out pretending to offer tax refunds. However, the DVLA says that it will never send emails or texts about car tax refunds, or ask you to confirm payment or personal details in this way. If you need to get in touch with the DVLA about a vehicle tax refund, visit GOV.UK to find out how to contact the DVLA directly. |
Do I qualify for a DVLA car tax refund?
You can only claim back road tax back for one of the following reasons:
- You’re selling your car or transferring it to a new owner
- Your car has been declared an insurance write-off by your insurance provider
- Your car has been exported out of the UK
- Your car has been scrapped
- Your car has been stolen
- Your car is registered as exempt from vehicle road tax
- Your car has been officially registered as off the road and has a Statutory Off Road Notification (SORN).
There are no other circumstances in which you can cancel your road tax and ask for a refund on any remaining months.
How to cancel car tax
To get a VED refund for any tax remaining on your car, first let the DVLA know why you want to cancel your road tax.
You can start the process to get a DVLA car tax refund online, although the procedure you need to follow varies on why you want to cancel:
You’re selling or transferring your car
You should notify the DVLA as soon as possible once you’ve sold your car. If you delay, you could be fined and you’ll still be liable for the car.
You need the 11-digit number from the vehicle’s log book (V5C). Give the green ‘new keeper’ slip to the buyer. Unless you’re selling to a motor trader, you then need to destroy the log book.
Your car has been written off by your insurance provider
To notify the DVLA that your car has been written off, you’ll need:
- The name and postcode of your insurance provider
- Your car’s registration number
- The 11-digit reference number from the yellow ‘sell, transfer or part-exchange your vehicle to the motor trade’ section of your log book.
You’re exporting your car
If you take your car abroad for less than 12 months, it still needs to be taxed as though it’s in the UK. But if you’re taking it away for over a year, it’s considered a permanent export and you can get a refund on your car tax.
You can’t just tell the DVLA online, though. You need to send in part of your log book. Follow the DVLA steps for taking a vehicle out of the UK.
You’re scrapping your car
There’s a process you need to follow to scrap a car. You need to use an approved facility and tell the DVLA that you’re scrapping your vehicle. The exact steps to follow depend on whether you’re planning to keep any parts or your registration number.
Your car has been stolen
If your car is stolen, you first need to contact the police, then your insurance provider. If your claim is successful and your insurance provider pays out, you need to let the DVLA know, either online or in writing.
You’ve modified your car
Serious modifications that affect your car’s engine size or fuel type can change your car’s tax band, and either increase or decrease the road tax you pay. You may also become exempt from paying road tax if you become disabled or your car crosses the 40-year-old ‘historic vehicle’ threshold.
Whatever the tax situation, you need to tell the DVLA about the change. If you need a refund, there’s an extra form to complete. Follow the GOV.UK steps for changing your car’s tax band.
You’re taking your car off the road
If your car is off the road and parked on a private driveway, land or garage, you can apply for a SORN from the DVLA. You can apply for a SORN using:
- The 11-digit number in your vehicle log book (V5C)
- The 16-digit reference number on your vehicle tax reminder.
How to get a car tax refund?
Once you’ve cancelled your road tax with the DVLA following the correct process, they’ll automatically process your car tax refund.
If you pay your road tax by direct debit, this will be cancelled and you’ll no longer be charged. If you pay every six months, or annually, you’ll be sent a cheque for any refund you’re due.
If you paid your road tax for the year upfront, the DVLA will send you a refund by cheque for any full months left on your car tax. The cheque will be sent to the name and address listed on the vehicle’s log book.
How much road tax refund will I get?
Your refund will be calculated from the date the DVLA gets your information. The amount you’ll get depends on how many months you’ve paid for in advance. You’ll only get a refund for any full months left on your road tax.
You also won’t get a refund for:
- Any credit card fees
- The 5% surcharge on some direct debit payments
- The 10% surcharge on a single six-month payment.
How long does a car tax refund take?
Your car tax refund should arrive within six to eight weeks. You might even get it sooner than this.
However, if you haven’t received your cheque after eight weeks, you should contact the DVLA to chase it up. You can either do this by email, webchat, post or by phone.
The car tax refund contact number is 0300 790 6802, but it’s unlikely that the DVLA will follow up on a missing refund cheque until after the stated processing time.
How can I get car tax for a new car?
If you’re getting a new car (whether buying new, buying used or transferring ownership), you need to get new car tax. You can’t transfer the tax from your old car and you can’t use any tax paid by the car’s former owner.
Your new car must be taxed before you can drive it. You can apply for car tax online, which is quick to do if you have the right reference number. Make sure you get the New Keeper Supplement (V5C/2) paperwork when you buy your car and everything should be straightforward.
You can also apply by phone on 0300 123 4321 or in person at a Post Office.
It’s important to make sure you’re paying the correct tax and are fully insured before you get behind the wheel in your new car.
Can I get a refund on car insurance?
If you’re getting rid of your car, you can usually cancel your car insurance policy and get a partial refund – although there are a few hoops to jump through. The amount you’ll get back depends on when you end the policy and you’ll have to pay cancellation fees. Contact your insurance provider or go to their website to find out how.
You don’t necessarily have to cancel your policy if you’re selling your car and getting a new one, though. Most insurance providers will update your old policy to cover your new car. This will avoid any cancellation fees (although you might still be for charged an admin fee for amending your policy).
However, this might not always be the cheapest option. The price you pay for your premiums could go up or down depending on the car you buy and the insurance group it’s in.
Take the opportunity to compare car insurance to see if you could get a better deal elsewhere. It’s quick, easy and could save you money.
Frequently asked questions
How do I get a road tax refund if I pay by direct debit?
If you pay by direct debit, contact the DVLA directly and let them know why you’re cancelling your car tax. They’ll automatically cancel your direct debit and send you a cheque refund for any full months left on your road tax.
If you cancel your direct debit just before your monthly payment is due, the DVLA might still take the payment. If this happens, you should get an automatic refund back into your bank account within 10 working days.
What if my refund cheque is wrong?
If there’s a mistake on your refund cheque, send it back to the DVLA explaining what the error is. You’ll need to send it to:
Refund Section
DVLA
Swansea
SA99 1AL
You should receive a replacement cheque within four weeks.
Why did the DVLA reject my application for a car tax refund?
Your car tax refund application is most likely to be rejected if your details are wrong. When filling out your application, your details must match those in your log book exactly.
If you change your name or address, you must tell the DVLA and update your V5C log book, driving licence and VED direct debit (if that’s how you pay your road tax). If not, you could be fined up to £1,000.
If you’re a resident of Northern Ireland, you’ll need to update your address at nidirect.gov.uk.
How can I check if a vehicle is taxed?
You can check if a vehicle is taxed or registered as SORN at GOV.UK.
You’ll need the vehicle’s registration number and 11-digit reference number, which can be found in your V5C log book.
If I SORN my car, will I get a tax refund?
Yes, after declaring your car as off-road, the DVLA should automatically send you a refund cheque for any full months left on your road tax. This can take up to eight weeks.
How do I tax my car after SORN?
Once you’re ready to take your car on the road again, simply apply for road tax on the DVLA website or by phoning 0300 123 4321.
As soon as you do this, the DVLA will automatically cancel the SORN.
Just remember, you’ll also need car insurance and a valid MOT certificate to drive on the road again.
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