What You Need to Know About the End of the Tax Disc
After 93 years, an iconic part of British motoring is coming to an end. The paper tax disc is being phased out on the 1st of October in favour of a direct debit tax payment system that simplifies the process of paying tax for motorists.
Paper tax discs are being phased out in October after being used for more than 90 years. Image © Depositphotos.com/Stephan Morris
While the new laws are due to take effect on the 1st of October, many drivers remain unaware that any changes have been made. A recent poll found that 40% of drivers did not know that there were impending changes to the tax disc coming.
In this guide, we’ll cover all that you need to know about the phasing out of the tax disc. From fines for non-compliance to new payment options, read on to learn more about the end of the tax disc and the upcoming changes to car tax laws.
From the 1st of October onwards, the paper tax disc will be phased out. Car owners will still need to pay tax on their vehicles, and taxes will not be transferred for used vehicles.
— Lorna (@Lorna_Blackmore) September 5, 2014
Instead of paying for a paper tax disc, vehicle owners will need to register their car online for Vehicle Excise Duty. The Driver and Vehicle Licencing Agency (DVLA) offers a variety of tax payment options for car owners, including online direct debit, via phone or at the Post Office.
The iconic paper tax discs, which have been in use for over 90 years, have largely been replaced by electronic number place readers that can check whether or not a vehicle owner has paid their road tax.
Does this affect you?
The people most affected by the changes are buyers and sellers of used cars. One of the major changes of the tax disc phase out is that road tax is no longer transferable for people buying a second-hand vehicle.
This means that if you’re buying a used car, you’ll need to renew its tax disc right away. You’ll no longer be able to benefit from the existing months on the vehicle’s current tax disc.
If you’re selling a used car, you’ll be granted a full refund for the remaining time on the vehicle’s tax disc if you notify the local authority. To do this, you’ll need to fill in a V5C vehicle registration certificate authorising the change of ownership.
Sellers need to alert the DVLA immediately after the vehicle changes hands. Those that don’t send in their V5C forms in after their vehicle comes under new ownership could face a £1,000 fine.
Buyers of used vehicles could also face fines. In addition to being charged any back tax still owed on the vehicle, drivers of untaxed cars face fines of £80 for driving an untaxed vehicle on public roads.
New payment options
In place of the old paper tax discs, drivers will be able to pay their road tax digitally or over the phone using a variety of payment options. Car owners can now pay using their credit card or online via direct debit, albeit with some additional surcharges.
Vehicle owners that choose to pay their road tax monthly will face a 5% additional fee, while credit card users will face a £2.60 surcharge on each payment. Annual or six-month road tax payment options will remain available.
The new payment options are designed to make paying road tax easier for the few unlucky motorists who genuinely forget to pay their road tax on time, in addition to reducing the number of car owners that drive untaxed vehicles.
The end of an era
Paper tax discs have been in use for 93 years, making them an easily recognisable part of British motoring history. As they’re phased out, many collectors think they could become an iconic part of history with a significant value.
Vintage tax discs have been sold for significant sums before, with a disc dating back to December 1921 sold for £810.30 online. Tax disc collector Tony Hill advises car owners to “keep those discs about to expire”, as they “could be worth a few quid.”
So there you have it. No more popping down to the local post office when you receive your car tax reminder through the post. Along with insurance, MoT and car tax, car warranty is a utility you can’t ignore and provides complete peace of mind that you will be protected in the unfortunate event of your car breaking down. Get a quote for your vehicle today, simply enter your registration in the box above.