Car tax changes and effect on traders
Discussion
Hi all,
I was just familiarising myself on the car tax changes that come into effect in October. Cars can no longer be transferred with remaining tax left on them. Notwithstanding the massive swiz this is on the general public (i suspect that 90% of sold cars will now have the selling months tax paid twice, once by seller, once by buyer), but I'm unsure how this will work with part time traders such as myself... Let me explain.
I buy and sell cars part time as a bit of a hobby which allows me to drive cars I like for a little while then sell on. It's legit, I pay tax on income earned (which is not much), have trade insurance and have trade plates for when I don't have a car taxed.
Now, first thing I understand is that the refund to the seller for the remaining full months tax is paid when the name on V5 is changed.... Which means if I keep a car for a few months, the poor vendor will not get paid! The inevitable effect of this is that no one will want to sell a car to a trader unless it is already sorned.
Even getting over that, if I then manage to purchase a car and tax it, then when I sell later on, the refund goes to the person on the v5 :s.
This sounds like a total crock. The only inevitable conclusion that I can come to is that I'll have to register the car in my name, which then makes it private, which then doesn't benefit the buyer of my cars as purchases are no longer covered by SOGA...
Have I missed something or is this another crap piece of legislation?
Cheers
Pad
I was just familiarising myself on the car tax changes that come into effect in October. Cars can no longer be transferred with remaining tax left on them. Notwithstanding the massive swiz this is on the general public (i suspect that 90% of sold cars will now have the selling months tax paid twice, once by seller, once by buyer), but I'm unsure how this will work with part time traders such as myself... Let me explain.
I buy and sell cars part time as a bit of a hobby which allows me to drive cars I like for a little while then sell on. It's legit, I pay tax on income earned (which is not much), have trade insurance and have trade plates for when I don't have a car taxed.
Now, first thing I understand is that the refund to the seller for the remaining full months tax is paid when the name on V5 is changed.... Which means if I keep a car for a few months, the poor vendor will not get paid! The inevitable effect of this is that no one will want to sell a car to a trader unless it is already sorned.
Even getting over that, if I then manage to purchase a car and tax it, then when I sell later on, the refund goes to the person on the v5 :s.
This sounds like a total crock. The only inevitable conclusion that I can come to is that I'll have to register the car in my name, which then makes it private, which then doesn't benefit the buyer of my cars as purchases are no longer covered by SOGA...
Have I missed something or is this another crap piece of legislation?
Cheers
Pad
I guess that when a car is traded in / sold to a trader and the relevant part of the V5 is completed and sent off to DVLA (cant remember which part of the V5 refers to selling to trade), this will cancel the RFL on the vehicle and the seller will receive a refund for any unused RFL. I'm guessing that you dont currently complete this part of the V5 to inform the DVLA that the vehicle is in the trade? If not why not? Obviously if you don't do this the "poor vendor" will also be responsible for any motoring offences caught on camera whilst your using the vehicle.
If as a trader you want to use the vehicle for your own private use you will need to tax it, if you put it into your own name and then sell it that wont make it a private sale, you are still a trader. Dealers often have demo's, service loan vehicles, pre reg vehicles in there name, when sold these are still retail sales.
The upshot appears that if you want to use the cars that you trade you will have to tax them and either put them in your name or your business name. However when you sell them on you will reclaim any unused tax like everyone else.
If as a trader you want to use the vehicle for your own private use you will need to tax it, if you put it into your own name and then sell it that wont make it a private sale, you are still a trader. Dealers often have demo's, service loan vehicles, pre reg vehicles in there name, when sold these are still retail sales.
The upshot appears that if you want to use the cars that you trade you will have to tax them and either put them in your name or your business name. However when you sell them on you will reclaim any unused tax like everyone else.
Edited by oldnbold on Tuesday 26th August 17:44
brightonpad said:
The only inevitable conclusion that I can come to is that I'll have to register the car in my name, which then makes it private, which then doesn't benefit the buyer of my cars as purchases are no longer covered by SOGA...
Whether you've been on the V5C as a keeper, or it's "just" been done on the yellow bit of the V5C, makes no difference at all to SOGA rights.When you buy, the vendor gets their unused tax back.
When you sell it, the new keeper taxes it.
If you've just got the car via the V5C/3 yellow bit, I'm not sure you're meant to be using it as your own smoke anyway.
No, I always have the large part of v5, yellow bit gets sent off as its been sold to trade...DVLA then know I have the car and am at liberty to smoke around to my hearts content provided its taxed and insured, which it always is. Looks like I'll just have to register in my name I guess... Ho hum.
Cheers
Cheers
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