How To Cancel Your Car Tax And Get A Refund

What is car tax and when can you cancel it?

Car tax (Vehicle Excise Duty, or VED) is the annual charge the DVLA levies on vehicles used or kept on public roads. You can cancel it when the car is no longer being used on the road.

VED funds general government spending and the rate you pay depends on CO₂ emissions, fuel type, and list price.

For a breakdown of what drivers pay in each VED band, check the DVLA rate tables on GOV.UK.

Standard 12-month VED sits between around £20 for low-emission cars and over £700 for high-emission models first registered since April 2017.

Electric vehicles lost their zero-rate status in April 2025, so EV owners now also need to keep tax active or declare SORN when the car is off the road.

When can you cancel?

The DVLA accepts a cancellation in five scenarios:

• You’ve sold or transferred the vehicle to someone else.
• You’ve scrapped it at an Authorised Treatment Facility (ATF).
• It’s been stolen (you’ll need a crime reference number).
• You’ve exported it out of the UK for 12 months or more.
• You’ve taken it off the road and declared SORN.

If the car is staying off-road on your driveway or in a garage, you need to declare it SORN before the refund can be processed.

How do you cancel your car tax through the DVLA?

You cancel car tax online, by post, or by phone. The online route is the fastest and works for every cancellation reason.

What you’ll need before you start

• Your V5C logbook reference number (11 digits, on the latest document).
• The vehicle registration number.
• The reason for cancellation (sold, scrapped, SORN, exported, stolen).
• Your bank details if the original payment method needs updating.

Step-by-step process

The online flow takes five minutes once you have the V5C to hand:

• Go to GOV.UK and choose the cancellation reason that fits your situation.
• Enter the vehicle registration and V5C reference number.
• Confirm the date of the change (sale, scrap, SORN, export).
• Submit the form and save the confirmation email.
• Wait for the refund cheque or automatic direct debit cancellation.

The GOV.UK cancel vehicle tax page routes you to the right online form based on your reason.

Can you cancel by phone or post?

Yes, but it’s slower. Phone cancellations go through the DVLA on 0300 790 6802, and postal cancellations use a letter to DVLA, Swansea, SA99 1AR with the relevant V5C section enclosed.

Phone support is available Monday to Friday 8am to 7pm and Saturday 8am to 2pm. Postal cancellations typically take four to six weeks to process once the DVLA receives the paperwork.

What if you’ve lost the V5C?

Apply for a replacement V5C on GOV.UK before you try to cancel. The replacement takes around five days to arrive and costs £25.

If the vehicle has been scrapped and you don’t have the logbook, the Authorised Treatment Facility can still notify the DVLA using their own disposal paperwork.

Why might you be eligible for a car tax refund?

You’re eligible for a refund any time you cancel the tax while full months of cover remain, and the trigger is usually a change in how you use or own the vehicle.

Selling or transferring the car

Tax no longer transfers with a car when it’s sold, so the new owner must tax it in their name from day one.

Send the V5C/2 section to the buyer and notify the DVLA to trigger your refund. If you’re changing cars, check whether you can transfer your no-claims bonus to the new vehicle.

Scrapping or writing the car off

If the car has been scrapped at an ATF or written off by your insurer, the tax is cancelled as part of the disposal process.

How an insurer settles depends on the damage and the accidental damage cover on your policy (Cat A, B, S, or N), but the VED refund follows regardless of outcome.

Declaring SORN

A SORN tells the DVLA the vehicle is off the public road and won’t be used or parked on one.

You can only use one for a pre-booked MOT, so check the rules on driving without a valid MOT before moving it.

Exporting the vehicle

If you’re taking the car out of the UK for 12 months or more, complete section 2 of the V5C and post it to the DVLA.

The refund is issued from the month the DVLA receives the notification, not the date you left the country.

Theft

Report the theft to the police first and keep the crime reference number to hand.

You’ll then need to write to the DVLA enclosing the crime reference, and the tax is cancelled from the date of the report.

If the car is later recovered, the tax isn’t reinstated automatically, so you’ll need to retax the vehicle before driving it again.

Do you get a full refund or just a partial one?

You get a refund for every full calendar month of tax remaining at the point the DVLA processes the cancellation. Partial months are not refunded.

How the DVLA calculates your refund

The DVLA divides your annual or six-monthly VED payment by the number of months it covers, then refunds whole months only from the date of cancellation forward.

Any 5% surcharge for paying in instalments, plus the 10% surcharge on six-monthly payments, is not refunded.

The first-year, emissions-based ‘showroom tax’ paid on new cars isn’t refundable on a pro-rata basis either, because it’s treated as a one-off charge rather than annual VED.

What triggers the refund

The clock stops on the date the DVLA receives and processes your notification, not the date you sold, scrapped, or stopped using the vehicle.

Sending the paperwork promptly is therefore the single biggest factor in how much refund you receive.

Example refund amounts

These figures assume a single annual payment, and the exact refund depends on the month the DVLA processes the paperwork.

The official working is explained on the GOV.UK vehicle tax refund guidance.

How long does a car tax refund take to arrive?

A car tax refund usually arrives within six weeks of the DVLA processing your cancellation, though most drivers see the money in four to six weeks.

Refund timescales by payment method

What if the refund doesn’t arrive?

If six weeks pass and nothing lands, contact the DVLA on 0300 790 6802 or write to DVLA, SA99 1AL with your reference.

Refunds are sent to the name and address on the V5C, so an outdated logbook is the most common reason for a missing cheque.

Update your address on GOV.UK before submitting the cancellation if you’ve recently moved, otherwise the cheque will be posted to the previous property.

What if the cheque is in a previous owner’s name?

This happens when the seller forgets to notify the DVLA. You’ll need to return the cheque with a covering letter so the DVLA can reissue it.

If you’re the new keeper and the previous owner’s details are still on record, the DVLA treats that person as the payer and the refund has to go to them first.

What happens if you cancel your tax but keep driving?

Driving an untaxed vehicle on a public road is a criminal offence and the penalties start with an £80 fixed penalty notice.

Fines and enforcement

DVLA cameras and ANPR systems flag untaxed vehicles automatically, and the registered keeper is fined even if someone else is driving.

Unpaid penalties can escalate to £1,000 and courts can order the vehicle to be clamped, impounded, or destroyed.

A clamp release fee is £100 and impound storage charges run at around £21 per day, so a short lapse can quickly become expensive.

The insurance angle

An untaxed car isn’t an uninsured one by default, but most car insurance companies require the vehicle to be road-legal at the point of a claim.

The rules on driving without road tax are separate from the Continuous Insurance Enforcement (CIE) rules, so it’s easy to fall foul of one while complying with the other.

Coming back on the road

If you’ve declared SORN and want the car back in use, you need to lift the SORN declaration and retax the vehicle on the same day.

You can tax a car even without a current MOT using the V11 reminder or V5C reference, and the new tax must be active before the vehicle touches a public road.