Saying Goodbye to the Tax Disc


Sep 30, 2014
Saying Goodbye to the Tax Disc

You may not be aware but as of the 1st October 2014, Car Tax as we know it will change forever with the demise of the Tax Disc. 

 
Yes it’s true; after 93 years of loyal service, the tax disc will be no more. In the words of that famous Monty Python sketch, the tax disc is has ceased to be; expired; gone to meet its maker; is bereft of life; it is an EX Tax Disc!

The fact that you may not be aware of this major change comes as no surprise; rest assured you are in good company as a recent survey revealed that half of UK drivers were oblivious to the changes. 

Don’t get too excited though, the abolition of the car tax disc doesn’t mean an end to road tax; it’s just another step forward (some may say backwards) in our ever changing digital age. You still need to buy car tax (sorry folks, the changes aren’t that radical) however the new process should make buying and indeed paying for vehicle tax much easier. 

To clear the congestion and bring you up to speed (urgh, even I think my jokes are getting worse), here is a list of the changes:

From the 01/10/14 you will no longer need to display your tax disc. The DVLA has a digital record of payment which will be checked using number plate recognition cameras, so you can throw those circular pieces of paper away, or frame them if you prefer!


You will no longer be able to transfer road tax when buying or selling a vehicle. Instead the seller must inform the DVLA (or receive a £1,000 fine) to be refunded any tax paid in advance (this only accounts for full calendar months that are outstanding). The buyer will then be responsible for taxing their new vehicle before driving it home.

A further change which is planned to come into force on the 1st November is the way we pay for our car tax. As well as having the option to pay in one go or bi-annually, you will also be able to pay over 12 monthly instalments. Instalment options will incur a 5 per cent fee but this may be worthwhile for those on a tight budget who prefer to spread their payments.

It is also worth pointing out that paying monthly will actually be cheaper than the current option of paying biannually which has carried a surcharge of 10 per cent. 

Of course a number of things remain the same. The road tax price bands will remain intact apart from the future addition of monthly payments; you will still receive a reminder from the DVLA when it comes to renewal and you will still be able to pay online, over the phone or at the Post Office so no change there.

The changes have been designed to save money however they are not without their fair share of sceptics. The RAC claim that doing away with the car tax disc will cost the economy £167 million a year, tempting more drivers to dodge paying tax altogether, likening it to the ongoing problem of car insurance evaders. Of course the DVLA claim these figures are nonsense so it will be interesting to see how things progress.  

As always we would love to hear your thoughts on these changes; it would also be good to know your plans for the soon to be defunct tax disc and how you plan on marking this ceremonious occasion.   


Ashley Shepherd is an Over 50s Personal Finance Expert

ashley shepherd

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