How to cancel vehicle road tax and get a refund

First introduced in 1937, car tax — also known as road tax — contributes around £6.5 billion annually to the UK government coffers and is spread across funding for public services, education, welfare, and public projects.

What was once handled only by local authorities has now become a legal necessity for all drivers with a car on public roads. It’s also formally known as ‘Vehicle Excise Duty' (VED) and should be accompanied by car insurance and an MOT (if the car is over three years old.)

While car tax is legally required, there may be some instances where you’ll get to cancel your road tax and get a refund.

This article is about how to cancel your road tax and how long it takes for your refund to appear.

What reasons can I have for cancelling my car tax?

Before we get into possible reasons for cancellations, some vehicles are automatically exempt from paying road tax. These include:

• Electric vehicles
• Steam vehicles
• Vehicles used solely for forestry, horticulture or agriculture
• Mowing machines
• Disabled passenger vehicles
• Mobility scooters, powered wheelchairs and invalid carriages
• Vehicles used by a disabled person
• Historic vehicles built more than 40 years before 1st January of the current year

If your car doesn’t fall into any of the above situations in those categories, here are the only reasons you can have for cancelling your car tax.

• If your car is stolen
• If you’re involved in an accident and the vehicle is written off by your insurance company
• If you sell your car to someone else.
• If the car has been scrapped at a vehicle scrapyard
• If you’re newly exempt and registered from paying vehicle tax

If you’re not currently using your car, you can declare it as ‘off the public road', also known as “Statutory Off Road Notification” (SORN) — this means you can’t drive your car and must keep it in a garage or an off-road location.

How to cancel car tax

Cancelling your road tax is a simple process. Firstly, and most importantly, you must contact the Driver and Vehicle Licensing Agency (DVLA) quickly.

Once you’ve explained your reason for cancelling, there’s a wait period while the DVLA processes the cancellation.

Upon approval, your refund will be on its way. It’s as easy as that.

But remember, there is a risk to continuing to drive your car after cancelling the car tax. The DVLA runs monthly checks to find untaxed vehicles, with a fine of £80 given to those without it. It’s even worse if the police catch you as it could result in a penalty of £1000 and they might clamp your car.

Can you cancel your car tax online?

You can cancel your car tax through various avenues, including the online email service, telephone, and even by post.

If cancelling online, there are some questions to answer before it leads to an email and message form.

How long does it take to cancel road tax?

The actual cancelling of the road tax takes as long as it takes to contact the DVLA, which doesn’t take much time.

Once it’s in their hands, they will go through the cancellation process on your behalf. From first contact to refund, it can take six to eight weeks.

What paperwork do I need to cancel my car tax?

You only need your V5C (vehicle log book) or a V11 road-tax reminder form. The logbook will have been given to you upon purchase of the vehicle and it contains all the vital information, including the date the car was registered, the colour, engine size, the manufacturer and who the registered keeper is.

If you’ve misplaced, stolen, destroyed or damaged your logbook, you can purchase a duplicate directly from the Government website and DVLA.

Car tax refund

Cancelling car tax has never been more straightforward. All it takes is for you to let the relevant agency know to get the ball rolling for your refund.

Will I get a refund if I cancel my road tax and pay by Direct Debit?

If you’re already paying by direct debit, the DVLA will stop this when you cancel your direct debit payments for your car tax.

If you cancel this just before a monthly payment is due, they will send you a refund within ten working days if they continue to take the money by direct debit.

For those who cancel ahead of the renewal date, you should receive a refund cheque for any remaining full months left on your vehicle tax. This amount is calculated from the date that the DVLA gets your information.

How will my car tax refund be paid?

While the process to cancel can be easily completed via the Internet, the car tax refund isn’t as modern. The DVLA processes car tax refunds through cheques which will be sent in the post to the address where you made your first tax payment to the DVLA.

How long does a car tax refund take?

If you cancel via the DVLA online services or by telephone, it can take up to six weeks for your car tax refund to come through. It may be up to eight weeks for applications to cancel that were sent by post.

What if I don’t receive the car tax refund I’m owed?

If they accept your reason for cancellation, and you haven’t yet received a refund after six weeks, it’s best to contact the DVLA again.

They will let you know if there’s been a hold-up or any issues with refunding and they can get your return sent to you as soon as possible.

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