Road Tax and Recycling: Navigating the Rules When Scrapping a Car with Outstanding Tax in the UK

Most people choose to scrap their car because it has become a financial burden. It might be in need of major repairs or simply not worth paying to keep the vehicle running at that point in its life. If you find yourself in this situation right now, the last thing you want to do is waste more money on it!

That’s why we’re here to help you recoup the remaining yearly money you’ve paid out for car tax, in the form of a refund.

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Checking If You Can Get A Refund For Your Car Tax

First things first, you are only eligible for a refund if you’ve paid your car tax in one lump sum for the entire year. If you pay monthly, via Direct Debit, you won’t be owed anything back because you haven’t paid for any tax ahead of time.

Since you’re only refunded for full months of paid tax (more on that later) you won’t be refunded if you pay monthly – your tax going forward will simply be cancelled and nothing more will happen.

How To Get A Refund For Your Car Tax

So you’ve established that you’re owed a refund. It must be extremely difficult to get a refund for any kind of tax, right? Well, actually, it couldn’t be much easier to get a refund for your car tax when you’ve scrapped your car!

All you need to do is inform the DVLA that the vehicle is no longer yours. You might have scrapped it, or sold it, or written it off, or even SORNed it; it doesn’t actually matter, you just need to tell the DVLA that ownership of the car has changed hands. Once you’ve informed them, they’ll process this and your refund will be calculated and issued automatically.

It’s really that easy! Especially when you consider that you, by law, have to inform the DVLA when you’ve sold or transferred ownership of a vehicle anyway. Failing to do that will land you with a pretty hefty fine, or even more serious punishments!

How Long It Takes To Get Your Car Tax Refund

We’ve told you that getting your car tax refunded was easy – we never told you it was quick. Many people might think they need to do something else, even after informing the DVLA, to acquire their tax refund because it can take so long for the cheque (yes, the DVLA still use cheques) to actually arrive.

So how long should you wait for that money to arrive by post? Anywhere between 4 to 8 weeks! The sooner you tell the DVLA that you’ve scrapped your car, the better.

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How Much Money You’ll Be Refunded For Your Car Tax

The most important question for most of you reading this: How much cash will you be banking once that refund cheque drops through the letterbox?

Unfortunately, the it might not be quite as much as you’re expecting, so temper your expectations a little bit. You might have done the maths and now be thinking “I scrapped my car part-way through a month, and I paid for the whole month. Why have I been refunded less?”

The reason for this is that you can only be refunded for full months of tax. For example, if you paid for a year of car tax on the 3rd of August, then sell your car on the 5th of May, you’d probably expect to get refunded for the whole of June & July, plus around 28 days of May since you only ‘used’ 2 days of tax in May.

That’s not how it works, though. Even though you only had the car taxed for 2 days in May, the DVLA will count that as a full month of tax and will not refund it. So, in this example, you’d be refunded for the months of June & July only.

Scrap Your Car With Scrap Car Comparison For A Simple Tax Refund

Selling your car for scrap is just as simple as getting a refund on your car tax, if you sell it with Scrap Car Comparison! Get a quote in seconds today, and the price you’re presented with is guaranteed – so what you accept is what you get paid! Get a great price for your old banger, and a tax refund too, with our quick, easy, and no-obligation quote system today.

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