Road Fund Licence Changes – FAQ’s




As most of you will know 1st October 2014 is ‘D- Day’ for the RFL changes.

Here are a selection of the most pertinent and frequently asked questions on the subject, as answered by the DVLA:


Q. Given that paper tax discs no longer need to be displayed from the 1st October how will a vehicle repairer know if a car is taxed for the purpose of test drives?


A. Check at www.gov.uk/check-vehicle-tax but if in doubt as to the vehicle tax status use trade plates for day to day business otherwise an unsuspecting repairer may be prosecuted for driving an untaxed vehicle.


Q. At what point does it become the responsibility of a new owner to tax the vehicle?

A. As soon as the customer purchases a vehicle and decides to become the registered keeper on DVLA records they must tax immediately. They do not need to wait for the Registration Certificate (V5C) to be in their name to tax.


Q. If a car dealer is sitting with cars in stock with current and valid tax, what happens to the tax on 1st October since these cars will be ‘in trade’ and have no current keeper?

A. Any vehicle currently in the motor trade with a valid tax disc will continue to be taxed until the vehicle is sold. At that point the present tax will terminate. No refund will be paid where the vehicle is recorded as in the motor trade. For any refund to be issued there must be a registered keeper held on DVLA records. This has been the case since 2009.


Q. Can car dealers continue to tax vehicles for customers on their behalf?

A. Yes, by using V5C/2, either online at https://www.gov.uk/tax-disc using the V5C/2 of the V5C, by telephone on 0300 123 4321, or at a PO branch that deals with vehicle tax.


Q. How will the tax change affect vehicle auction companies?

A. Vehicles transferred to an auction company will be untaxed from 1 October. Once the seller informs DVLA that they have sold the vehicle they will receive an automatic refund. The buyer will need to tax the vehicle using V5C/2 before they drive it away from the auction house, online or by phone as noted above.


Q. Can dealers use existing stock as ‘staff cars’ if they retain a valid tax disc?

A. No, dealers will have to register in their own name and tax the vehicle. Dealers have always been required to register vehicles in their name if they wish to use them for staff or personal reasons. If used for a valid ‘trade plate’ reason, then the current trade plate rules apply and the vehicle does not need to have tax. For further information go to https://www.gov.uk/trade-licence-plates .   


Q. Do existing paper tax discs issued need to be visible from 1 October?

A. No.


Q. Can we perform a change of keeper online?

A. Not yet, but DVLA will introduce this soon. As noted above you do not need to be the registered keeper to tax. From 1 October you can use the new keeper supplement of the log book.


Q. When can we pay car tax by direct debit?

A. Starting from 1st November 2014.


Q. If a registered keeper does not apply for a refund when selling a vehicle to a motor trader before October will an automatic refund be issued for the remaining duty once DVLA is notified of a new keeper after 1 October?

A. Yes, an automatic refund will be issued to the previous keeper once a new keeper notification is received after 1st October.


Q. Do cars in dealer stock, which are not taxed need to be SORN?

A. No, if registered ‘in the trade’ and kept on private land then SORN is not required. Trade plates can be used to demonstrate a vehicle.


Q. Can we legally drive a car to an MOT testing garage without tax?

A. Yes, providing the MOT test is pre booked.


Q. If a car is currently marked in trade and has a valid tax disc until sometime in 2015 will that tax be valid if the car is sold after October 2014?

A. No, the existing tax will terminate on the day the car is sold after 1st October. Any refund of tax will be issued to the previous keeper. If the trader wishes to receive the refund, they must have registered the vehicle in their name before 30th September.


Q. Is there any way for a dealer to check whether a car is ‘in trade stock’?

A. There is currently no way for a dealer to check this. DVLA are aware of vehicles held in trade stock and are investigating how that information might be made available to dealers. 


Q. What is the fine issued to a registered keeper for using a vehicle without valid tax?

A. Up to £1000.


Q. What is the method when selling a PX/trade car to a trader that is not being taxed in their name?

A.  The process is unchanged. There is no need to notify DVLA. Trade plates should be used if the vehicle is used on the road for test drives, delivery etc. There is no requirement for a dealer to tax a vehicle in their stock unless they want to use it for example as a staff car.


Q. Since trade discs are to cease can we 1) remove the triangular and destroy the tax disc from 1st October as with standard tax discs, and 2) remove the screw held triangle top section from the front of the plate? 

A.  Yes, there is no requirement to display anything in the triangular holder after the 1st October.


Q. Can a car currently taxed and ‘in trade’ be parked legally on the road?

A. No, a vehicle must be registered to a keeper and be taxed before it can be parked legally on the road. If the vehicle is notified as ‘in trade’, the vehicle must be used for day to day business under the cover of trade plates.
 

Authors: Howard Tilney

Published: 30 Sep 2014

Comments

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Howard Tilney - Lawgistics Ltd (18/01/2017)
The simple answer is NO! You cannot legally park a car on a public highway, which is untaxed, on trade plates.
Ty (18/01/2017)
Can a car currently "in trade" but with valid trade plates inside of car be legally parked on the road??
Howard Tilney - Lawgistics Ltd (31/08/2016)
Thanks for coming to the site but we only advise motor traders and not consumers and so cannot answer your queries. You are best advised to contact a consumer organisation such as the Citizens Advice Bureau or talk to a solicitor
Kev (31/08/2016)
Hi, I'm buying a car registered to a sole traders company name, London Aerial Services. The chap I'm buying it off is called Joe Bloggs so how do I know he actually owns the car or not?
Howard Tilney - Lawgistics Ltd (09/08/2016)
Providing the vehicle has been properly registered to the new keeper with DVLA post sale, then I do not see any liability on your part.
Nine Pound. (09/08/2016)
As a trader. If i sell a vehicle without tax. I deliver it to the customers premises on trade plates. The customer then decides they do not want to tax it until the following month. Am i in any way responsible if the vehicle is then driven on the road by the customer?
Howard Tilney - Lawgistics Ltd (18/12/2015)
Responsibility for insuring the vehicle must fall to the customer on hand over if not before. However, it would be best practice to at least advise the customer before hand over that he/she is responsible for ensuring that the vehicle is properly insured before they drive it away and make a note of that on the paperwork.
David (18/12/2015)
Dear Howard Prior to the car tax changes, as a trader selling a used vehicle, we used to obtain an insurance cover note from the customer and then tax the vehicle at the post office. Following the regulation change there is no requirement to produce an insurance certificate when taxing the vehicle, and if the MID is checked at that point the vehicle will show up as insured because it is insured as part of our stock. At the point the ownership of the vehicle is transferred and it leaves our site the vehicle ceases to be covered by our insurance. If we tax the vehicle and the customer has not arranged their own insurance, do we bear any responsibility in not checking their insurance before doing a vehicle handover? Many thanks
Howard Tilney - Lawgistics Ltd (16/10/2015)
With regret, we are unable to help you with that. May we suggest that you seek clarification from DVLA direct.
Kez (16/10/2015)
HI. I've just sold my vehicle to a trader and trying to complete the online VED to notify to cease tax . Why does it say "I understand that the registration number will be lost on the sale of this vehicle" I'm supposed to tick the box to confirm but don't understand why the reg plate to the car will 'be lost'. ??
Howard Tilney - Lawgistics Ltd (01/09/2015)
As a trader you have taken the car into stock. The trader notice to DVLA is correct. As you rightly observe, you cannot then put the car on the road unless you use trade plates or register the car to you as its keeper and tax it. I do not see anything suspicious or wrong with anything you have proposed. Whether it is one or one hundred days between the two registrations, it matters not. After all, circumstances change! Trade plates will certainly provide more flexibility in terms of road testing and the like but they have their own unique set of limitation and they come at a cost. It is a matter for you to weigh up the pros and cons of trade plates. If, on balance, they provide a net benefit to you then trade plates may be the way to go otherwise your current arrangements appear to be entirely appropriate.
PETEF (01/09/2015)
As a sole trader/repairer and on rare occasions purchase a vehicle to keep me busy when quite with repair work. I have in the past used the top trade sale section for the seller to send off and kept the V5C this avoids me having to register in my name. I recently purchased a vehicle that was using engine oil and needed the consumption monitoring with road use I purchased the vehicle four or five days before the end of he month. so on the first day of the next month decided to register it anyway in my name, Would this not look suspicious to DVLA as the tax would have been refunded to the previous owner it may look like I am trying to dodge a months tax though would obviously wait until it is tax legal before I used it the following month, I do not and have never owned trade plates do you think it would be a wise move to try and obtain Trade plates for my business use considering there appears to be grey areas with the new laws particularly occaisonal traders of cars like myself?
Howard Tilney - Lawgistics Ltd (11/05/2015)
RobinH - A motor trader is able to tax a vehicle on behalf of a customer using a V5C/2 before the customer drives it away. From 1 October 2014, motor traders are able to do this online or over the phone. Unused tax is always refunded to the previous registered keeper. As I understand it if the trader wants to use the vehicle then he will have to first register it to himself before taxing. If he then sells the vehicle to a customer any unused tax is refunded to the trader. I hope that helps.
RobinH (08/05/2015)
Hi. My question revolves around the issue highlighted by PhilH. The way I read it is that PhilH has already taxed the vehicle on behalf of whoever he sells it on to. When you tax a car in the manner Phil describes, at no point do the DVLA ask for your details, all they want is the payment. So who will get the tax refund when Phil sells the vehicle on? Not the previous owner - his refund was set in motion when the DVLA received his V5C/3 yellow slip. Not Phil, the DVLA do not have him down as the Registered keeper. The paper trail goes directly between the two names that appear in Section 8 of the V5C (the Registered Keeper and the New keeper).
Howard Tilney - Lawgistics Ltd (22/04/2015)
PhilH – Thank you for your enquiry. What you propose seems to me to be entirely sensible. However, I do not see what happens to these in practice so you may know better than me! Providing you are satisfied that you have registered your interest correctly using whatever medium is available via DVLA and paid the tax before you take the vehicle on the road then I do not see any problem. The same applies to your purchaser.
PhilH (17/04/2015)
I am a part time trader without the use of trade plates. Having just bought a car from auction, and being in possession of the full V5c (minus the trade slip) I can tax the car online using the V5c/2 reference number in order to use it until sold. I assume this makes me the registered keeper, which I'm fine with. If I sell the car in a few days, and pass on the same new keeper supplement to the buyer, can he use it again to tax it in his name?
Martin Sispera- Watford Herts (1/04/2015 (06/04/2015)
I can not to tax my car as the taxation class is the crown vehicle untill it changed to privete/light goods class and only can done at DVLA office
Howard Tilney - Lawgistics (23/02/2015)
Danny - If the car was untaxed when the garage put it out on the public highway then it is arguable that the garage are responsible for what happened thereafter. Of course the registered keeper is responsible for taxing/SORNing the car in the usual way. I am not entirely clear on the circumstances that led to this situation and other factors may prove to be relevant. Should you wish to discuss this case further then please do not hesitate to telephone me.
Daniel Hamilton (23/02/2015)
If a car is taxed and it runs out of tax while at the garrage whilst being repaired and the garrage leave it on a public road. And it gets clamped who's responsible for the fine. I had no keys to the car and it was completely in there custody at which point it would be returned to private land. Thankyou in anticipation. Danny
Howard Tilney - Lawgistics (28/01/2015)
I would guess that there must be a way to check if tax has been paid on a trade plate otherwise how would the authorities be able to enforce non payment? However, whether there is a register that can be checked by traders and the public at large I do not know. I suggest that you speak with DVLA. I would be interested to hear their answer.
Car User (27/01/2015)
Is there a way to check if the trade plates have valid tax? the website above only works when you know the make of a vehicle, not applicable on trade plates.
Howard Tilney - Lawgistics (07/01/2015)
I feel your pain Alan! Not an uncommon complaint. The moral of this story is trust no one and certainly never send anything to DVLA without proof of postage. Recorded delivery is best.
Alan (07/01/2015)
The system seems to be shambles sold my car 8/11/14 sent yellow slip on10/11/14 to get a refund of tax dvla say don't cotact us for 6 weeks no refund appearing I called dvla today to be told they don't have the yellow slip nothing they can do other than write in the meantime the vehicle I no longer have is still registered in my name they would not change this over the phone so until they change their records I am still liable for speeding & parking tickets
Howard Tilney - Lawgistics (08/12/2014)
If I have understood correctly, I am not sure this arrangement is lawful, so A1. we would not recommend such course, A2. probably not, but we cannot guarantee it.
no new keeper supplement - using old keepers VED (08/12/2014)
a family member (also a small motor trader) has just taxed a vehicle using the v5c, but obviously on old keepers name - it feels unfair that his money will just go back to the previous keeper when he sells the car. If I were to buy it and use it, It would come up as 'taxed' till dvla receive the v5 for change of keeper. its not a lot of money but the main issue is that there is no new keeper supplement as the old one was spoilt in a failed sale. there is V5 which we have signed but not posted. Q1. are there any implications to carry on like this for 2-3 months - we trust each other enough to own up to any offences etc. Q2. Will the DVLA question why the v5 was sent in a few months after the date of transaction?
Howard Tilney - Lawgistics Ltd (20/11/2014)
Removed by who? If it is private land and you have the consent of the landlord to park cars on it then I do not see that the tax authorities or its agents would be able to lawfully remove the vehicles if they are in stock. I suppose a sign as suggested would not hurt but again what business would the authorities have entering private land in such scenario?
Tony (20/11/2014)
Thank you for your reply Howard, If the land is accessible to the public can the cars be removed? ie. Not barriered or gated.Or would signage in the vehicles stating that the cars are parked with consent be enough th prevent removal. I do not mean "FOR SALE" signage!
Howard Tilney - Lawgistics Ltd (13/11/2014)
Tony - No you DO NOT have to own the private land that your "in trade" vehicles are stored on.
Tony (13/11/2014)
Do I ,as a trader have to own the private land that my "in trade" vehicles are stored at?
Big Problem (17/10/2014)
Sold a car saturday 11/10/2014 at 5 o'clock.customer had travelled 200 miles to my showroom.Tried to tax the car on line but the site had crashed and the post office was shut.The customer phoned the police to see if she could drive the car back with no tax and was told not to take the car on the road.So she travelled all the way back up north and had to return on monday to collect her new car.This poor lady had spent £120 on fuel for both trips and had a day taken out of her life and the car she purchased a peugoet 207 diesel was only £30 road tax.The £120 she spent on fuel could have taxed her new car for the next 4 years.Any ideas of a way around this if it should happen again ?
Howard Tilney - Lawgistics (15/10/2014)
Mia - there is certainly some merit in what you say.
mia (14/10/2014)
I still feel that the DVLA have not done and extensive research for motor traders. A) They say for a trader to drive the car on the road it needs to be registered in their name. Doesn't this devalue the vehicle as it's adding more owners? B) If a trader taxed one of his vehicles before the change and then sells the vehicle after October he looses his money. I for one bought a car in May 2014. The vehicle was parked away until I decided to use it in September. I taxed the vehicle obviously under trade knowing that the Yellow part of the log book was sent away. Come October I hear I cannot get my refund because the vehicle was not registered in my name. Apparently the money I paid £156 odd goes back to the previous keeper. This makes me wonder why do we need to put our details on the Yellow slip for? when that does not let you be acknowledged you are the owner in trade. I feel this is unfair. Just the thought that the previous keeper will be better off with something they sold and forgot about. I feel so angry with this change.Reason being I bought the vehicle paid the owner off, spent a lot of money servicing the vehicle and then to hear my RFL money goes to the previous owner. (So these coming days we shall get a 20k miles vehicle with 4 to 5 owners surely there shall not be a need for hpi. I use hpi to check such new vehicles when they have plenty owners incase of history. Surely hpi must pack up. Or unless DVLA should stop showing number of previous owners on the log books. C) The other issue I feel that has not been thought properly is say; I as a trader buy a vehicle today decide I want to use the vehicle so i tax the vehicle and send of the log book. Tomorrow I get a buyer whose really interested in my vehicle how do I sell the vehicle to him? I mean a vehicle without the v5c is as good as an illegal vehicle. I for one would never touch a vehicle without the v5c so how can a buyer trust you. Does that mean I will have to wait until 4 weeks before I can sell that vehicle until the v5c comes back. Surely this just shows I should quit my trade and sit on benefits as some of us traders rely on a 1 car sell at a time. Not all can afford forecourts. I would be happy to hear some positive feedback. Maybe some traders who are in my situation would have a better view of all this.
Howard Tilney-Lawgistics (10/10/2014)
Justib RSC Ltd - If I have understood your scenario correctly it seems to me that the customer should not take the risk. As soon as a customer indicates an intention to be the new keeper, whether that notice has been received and processed by DVLA or not, he should properly tax the vehicle in his name. Hope that helps if not then it might be best to call us to discuss.
Justib RSC Ltd (10/10/2014)
Final comment above, a car that is taxed but 'in trade' cannot be parked on the road ? Surely this is not enforceable............yet ? Today I have seen a car out and taxed it on line, however the V5 is going in the post later, car will be 'in trade' until V5 processed by DVLA, so is customer at risk ? I assume eventually we will be invited to give new keeper info when we tax the car ?
Howard Tilney-Lawgistics (09/10/2014)
Lewis - Who are you taxing it for? You or the new owner? If the car is registered to you and you tax it then on its sale the balance of unused tax comes back to you.
Howard Tilney-Lawgistics (09/10/2014)
Trader - correct.
Howard Tilney-Lawgistics (09/10/2014)
Declan - I believe that is correct.
Howard Tilney-Lawgistics (09/10/2014)
Darren - you are not the first to suggest this is a recipe for cloning but DVLA deny that. You can do a vehicle tax check on line at DVLA to see if any given car is taxed. If the internet is down on a Sunday and the customer cannot tax the car then the car is not taxed! Anything like mine, that's never gonna happen so you should be good to go.
Lewis Nicholls (09/10/2014)
Hi, if we tax a car on the day we sell it and any tax is cancelled as soon as the V5C hits the DVLA, won't it cancel the tax we've just put on?
Declan - Victoria Motors Ltd (09/10/2014)
If we tax a car in our business name for company use, picking up cars etc and sell it a week after sending the log sheet off then how will the customer tax it if we have to wait 6 weeks for the v5c. Could we tax it on the v5c/2?? and the customer still be legal??
Trader (09/10/2014)
If we register the car in our business name and tax it today for 6 months and manage to sell the car next week. Do we still get the refund for the remaining 5 months tax ??
Darren (09/10/2014)
surely this is making it easier for people to just clone a car that you don't now need a tax disc to tally up with the number plates. How will I know if a car is on the road legally if I or a customer has a crash on a test drive? What if a customer picks up his car on a Sunday and the inter net is down ? And what if my wife stopped moaning what excuse would I have to go down the pub?
shane Finch - Hammond Motor Group (08/10/2014) (08/10/2014)
You are able to tax a car for a new customer using the V5C aswell as the V5C/2, as the Post Office can select a change of keeper and hold onto the V5 and post to DVLA on your behalf.
Chris Nicholls Motors (08/10/2014)
Fantastic changes in that we can tax in the showroom.....
Howard Tilney - Lawgistics Ltd (03/10/2014)
From what you say the car is registered to you. If that is the case then you can tax and do with it as you please. Again any doubt as to whether the car is validly taxed please refer to the DVLA link contained within our recent article on the subject. If you have any further queries on this subject it may be as well for you to telephone Howard Tilney in our office to discuss.
The Car Company (02/10/2014)
Hi Howard, thank-you for your reply. The car was sold to us prior to 1st October and came with a bit of tax, so was loaned out to customers from time to time. The car was then taxed on 1st October using the new keeper slip (as is normal for us if we tax a car or tax a car for a customer). If this is is not "validly taxed" surely the post office shouldn't have allowed us to purchase the tax? We're a bit puzzled how a tax'd, mot'd & insured car can't be loaned to customers. Thanks in advance
Howard Tilney - Lawgistics Ltd (02/10/2014)
Good afternoon The Car Company, may I ask when was the car taxed? If it was taxed on or after 1 Oct 2014 then it could only be taxed with a registered keeper recorded at DVLA. If it was taxed pre 1 Oct then again it must have been registered to someone. If the car was sold to you with tax and then declared in trade and you are wishing to use it as a loan car then this is probably illegal. Whilst it may have a tax disc on it this does not necessarily mean to say that the car is validly taxed. Automated number plate recognition cameras will pick this up and fines are automatic. If there is any doubt as to whether a car is taxed then please use the link contained in the above article, to check its tax status with DVLA.
The Car Company (02/10/2014)
Q. Can a car currently taxed and ‘in trade’ be parked legally on the road? + A. No, a vehicle must be registered to a keeper and be taxed before it can be parked legally on the road. If the vehicle is notified as ‘in trade’, the vehicle must be used for day to day business under the cover of trade plates. IMPLICATIONS - we have just taxed a car to be used as a loan vehicle for customers. The car is "in trade". The above Q&A implies we cannot loan this car out. Is this correct? How will people know the car is as described above? The car has tax, MOT and is insured.
Howard Tilney - Lawgistics Ltd (02/10/2014)
Hi Daniel, hope this helps... 1) Post 1 October a car cannot be taxed without a registered keeper so taxing a car in advance on behalf of a customer is only possible if the customer is registered as the new keeper using V5C/2. In the stated scenario the vehicle would have to be re-registered to the dealer or more likely perhaps declared ‘in trade’. 2) That is the concern, yes. The dealer will have to make an assessment as to the extent of any possible devaluation before deciding whether or not it is worth registering a trade car to his business. It would seem that fewer and lower end car registrations of trade vehicles will have less impact. However, one would assume that if this practice becomes more common place over time and consumers become more familiar with the concept of more names on the log book then perhaps the long term effect of dealer registrations might be diminished – this is of course conjecture on the authors part.
Daniel (01/10/2014)
2 questions: 1) I tax a vehicle for customer who is buying a car in advance of them collecting it. However on the delivery date they decide against completing the deal. I therefore have taxed a car but not changed the registered keeper. What happens in this instance? 2) As a non franchise dealer, if i register a trade car in my name, to use personally and 'in stock' surely i am devaluing the vehicle by adding another owner? Especially so on high end cars that have multiple owners already.



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