If you drive a car first registered in 1981 or earlier, you can get exemption from Vehicle Excise Duty (VED – usually called “car tax”). That will save you £180 a year from April – or £295 if it has an engine over 1,549cc. A vehicle that is at least 40 years old does not usually need an MOT test certificate, either.
The tax exemption applies to cars, vans and motorcycles from after they reach 40 years old. So this year it applies to vehicles made before 1982 or registered before 8 January 1982. You cannot claim the exemption until 1 April, however, which means you have already used the car for four months and you will not get a refund for that time. Vehicles used for business, including taxis, do not get the exemption.
You can’t claim online: you must go to a Post Office and take the form V5C – what we used to call the “log book”. If you have had a VED reminder (form V11), take that, too. You will need to show an insurance certificate and a current MOT certificate, or a form called V112,
which is a declaration by you that your vehicle does not need an MOT – see below.
The V5C will be kept by the Post Office and sent to the DVLA, which will return it updated in a few weeks. You will also get a refund for any whole months of tax that fall after the exemption was granted.
The DVLA warns that it may take a while to return certificates and process refunds, but you can carry on driving while waiting. Every year you’ll be sent a reminder to tax your car – which you must do, either online or on the paper form, even though the cost is shown as £0.00.
Otherwise, you face an £80 fine.
Vehicles over 40 years old are also exempt from the MOT test, as long as no substantial changes have been made. Every vehicle must be roadworthy, though, so it’s a good idea to have a voluntary MOT once a year, anyway.
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Paul Lewis presents Money Box on Radio 4. QUESTIONS? Send any questions to Paul.Lewis@radiotimes.com. Paul cannot answer you personally, but will reflect them in his column