Car Tax Refund Guide for 2023

Car tax (also known as road tax) is an annual fee on UK vehicles to fund road maintenance and infrastructure. It’s a legal obligation to pay but if you’re selling your car, there are situations where you can apply for a refund on car tax. 

Understanding the process of getting a car tax refund can save you money on this annual fee whilst ensuring you comply with regulations. 

Here's all you need to know about obtaining a DVLA car tax refund, including: 

• When can I get a car tax refund?
• How do I get a car tax refund?
• How much will I get from my car tax refund?

When can I get a car tax refund?

There are several circumstances where you can apply for a car tax refund: 

• Selling your car  - If you’re selling your car before the end of the tax period, you may be eligible for a refund on the remaining months of tax. 

   

• Declaring your vehicle off-road (SORN) - If you declare your vehicle as off the road and apply for a Statutory Off Road Notification, you can be reimbursed on any remaining months of tax remaining. 

   

• Car scrapped or stolen - If your car is not recoverable from theft or scrapping, you can apply for reimbursement on your remaining car tax. 

It's important to note that these are the only permitted reasons for cancelling your car tax. Driving without valid tax can result in an £80 fine from the DVLA, which is reduced by half if paid within 33 days.

How do I get a car tax refund?

To receive a refund for any outstanding vehicle tax, you simply need to complete a car tax refund application form and provide the DVLA with a valid reason for canceling your road tax. The procedures for obtaining a car tax refund may vary, depending on the reason you provide.

• Selling or transferring your car: Inform the DVLA of the sale to initiate the refund process. It is important to do this promptly to avoid potential fines. Your refund cheque will be sent to you by mail, and if you have a direct debit, it will be automatically cancelled.

   

• Taking your car off the road: If your car is parked off the road on a private driveway, land, or garage, you can apply for a Statutory Off Road Notification (SORN) from the DVLA. You will receive a refund cheque from the DVLA for any remaining months of car tax you've paid.

   

• Scrapping your car: Follow the prescribed process for scrapping your vehicle, including using an approved facility, completing necessary paperwork, and informing the DVLA. Your car tax refund will be processed automatically.

   

• Exporting your car: If you take your car abroad for less than 12 months, it must still be taxed as if it were in the UK. However, if you plan to keep it abroad for over a year, it is considered a permanent export, and you can request a refund on your car tax. This requires submitting a portion of your logbook to the DVLA. Follow the DVLA's instructions for taking a vehicle out of the UK.

   

• Modifying your car: Certain modifications can affect your car's tax band and subsequently the tax you pay. Notify the DVLA about any changes to your car and, if applicable, complete an additional form for a potential refund. Follow the government's guidelines for changing your car's tax band.

Remember to carefully follow the specific steps provided by the DVLA for each scenario to ensure a smooth and successful car tax refund process.

Will DVLA automatically refund car tax?

You will receive an automatic refund for any full months remaining on your vehicle tax. The refund is calculated based on the date the DVLA receives your information. The refund cheque will be sent to the name and address listed on your vehicle log book.

How long does it take to get a car tax refund from DVLA?

To contact the DVLA regarding a car tax refund, you have the following options: phone, email, or post. It's important to note that DVLA car tax refunds may take up to 6 weeks to process, so please allow sufficient time before contacting them again regarding your application.

How much road tax refund will I get?

You will only receive a refund for any full months remaining on your road tax.

Additionally, the following deductions will be made from your total refund:

• Any credit card fees
• A 5% surcharge on certain direct debit payments
• A 10% surcharge on a single six-month payment.

Make sure you get your tax refund when selling your car

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