A guide to cancelling your car tax
What happens when you need to cancel car tax? Find out here
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You’ll be pleased to hear that it’s easy job to cancel car tax, and it can be done quickly online.
This is most important to know if you’re planning on selling your car or want to store it off road (SORN).
Learn how to cancel car tax in our guide below.
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What is car tax?
First things first, let’s clarify something: car tax, road tax and Vehicle Excise Duty (VED) are all different names for the same thing. It’s a tax you pay to legally drive and park your car on UK roads.
Most UK drivers pay car tax – unless you’re a lucky electric driver and get free car tax until 2025.
The money from car tax goes towards a big government pot that funds loads of things, not just the roads.
How much is road tax?
The standard tax rate for cars registered during or after 1 April 2017 is £190 a year, with a £10 discount for hybrids.
There’s also a £410 luxury car tax for models that were purchased for over £40,000.
This is because cars are placed into tax bands based on the age of the car and its CO2 emissions. If your car was registered on or after the April cut-off, it will be sorted into the standard, premium or zero tax bands.
Cars registered between 1 March 2001 and 31 March 2017 will pay road tax based on CO2 emissions and fuel type. Some cars can be as cheap as £20 per year to tax.
Do electric cars need road tax?
Electric cars do need road tax, but you don’t have to pay anything for it until 2025.
So, it might be free, but you still need to fill in the form to legally drive an electric car on the road.
For electric cars registered after 1 April 2025, you'll pay £10 for the first year and then the standard rate or £195 for each year after that.
Electric cars registered before 1 April 2025 wil pay the standard rate.
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How to remove tax from a car
To cancel your car tax, you’ll need to:
Let the DLA know why you want to cancel the car tax using the online service or by post
Wait for the DVLA to automatically process the cancellation
If you’re eligible for a refund – a cheque will arrive in the post
What information do I need?
You’ll need the car registration, a V5C logbook and/or a V11 road tax form.
When to cancel car tax
There are two main reasons that most people cancel car tax:
To sell their car or give it to a new owner
To take their car off the road, such as storing it in a garage or any other place that’s not a public road (SORN)
Some other reasons to cancel car tax include:
If the car has been written off or scrapped
Should you ever export the car out of the UK
If your car gets stolen
Eligibility for car tax refund
Once you cancel your car tax with the DVLA, a refund cheque will be posted to you if you’re eligible.
This is only the case if you’ve paid tax for longer than you’ll drive the car. For example, if you’ve paid for the full year upfront.
You won’t get a refund for credit card fees, the 5% surcharge on some direct debit payments, or the 10% charge on a single six-month payment.
Applying for car tax refund
You won’t need to apply for a car tax refund – these are processed automatically if you’re eligible.
If your refund cheque doesn't arrive after eight weeks, you can contact the DVLA for an update.
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SORN vehicles
If you’re taking your vehicle off the public road (like storing it in a garage, for example) you can tell the DVLA and get a ‘Statutory Off Road Notification’ (SORN).
It’s key to remember here that you can’t leave a SORN car parked on the road or in a public car park, it has to be on private land (e.g. a driveway) or in private storage (e.g. a garage).
You can do this online if the vehicle is registered in your name, or you can sort it out by phone or post.
If you’re applying online, you’ll just need the 11-digit number from your logbook, and the 16-digit reference number from your V5C or car tax reminder.
You’ll also get a refund for any full months remaining tax.