The coronavirus pandemic is having all sorts of implications – especially for people who are having to tighten the purse strings because they’ve been furloughed or made redundant as a result.
One way they may be looking to cut costs is the car tax – or vehicle excise duty to give it its official name.
The tax rates vary from vehicle to vehicle but they’re something that can add up to a sizeable amount over the year – assuming it hasn’t been paid for in full upfront. And with many now paying for their VED monthly, it could be an expenditure people are looking to cut.
In this guide – designed to give dealers information to give to their customers – we take a look at what we know so far.
Can I cancel my car tax because I cannot afford to pay?
Good news! Yes, you can cancel your tax – and even get money back – but there’s a catch…
What’s the snag?
If you want to stop paying your vehicle tax while keeping hold of your wheels, there’s only one way to do so and that’s to tell the Driver and Vehicle Licensing Agency (DVLA) that you’re taking your vehicle off the public road (eg, by keeping it on a driveway or in a garage) and, as such, that you want to SORN it. SORN stands for Statutory Off Road Notification.
How do I do this?
You can SORN a vehicle online at gov.uk/make-a-sorn or by phone on 0300 123 4321 (call charges apply for landlines and mobiles – check with your provider), or by post – you’ll need to complete and send application form V890 to DVLA, Swansea, SA99 1AR. To do it online you’ll need your V5C and it will need to have your correct name and address on it. Or, if you have been sent a V11 reminder form, you can do it using the reference number on that letter.
What if I can’t get hold of either my V5C or V11?
Well, you’re sort of out of luck. It’s not possible to do it without these documents and if they are stored somewhere other than where you are locked down you won’t be able to do it. You could try calling the DVLA and asking for help. Alternatively, if you cannot get through, you could think about cancelling the direct debit and worrying about the repercussions on the other side. However, we’d advise against doing that.
You mentioned getting some money back – how does that work?
If there are any remaining full months left on the tax, you’ll get that refunded. If you haven’t paid for them then you will save that money.
How about deferring payments?
No, that isn’t an option. You either have to pay the tax, or SORN your vehicle and take it off the public road. But remember you can only do that if you can genuinely keep it off road.
Are there any insurance implications?
The Association of British Insurers told us:
‘It is a legal requirement to have your car taxed unless you register your vehicle off the road and apply for a SORN. Different insurers have different processes for these situations. If you want to keep your car but won’t drive it for a while, contact your insurance provider to see how they can support you.’
Remember, though, that you won’t be able to take the vehicle back out on public roads until you’ve taxed it again.
This article will be updated if and when the situation changes because of the coronavirus crisis.