How to cancel your car tax and get a refund
You can cancel your car tax and get a refund if your vehicle is sold, scrapped, stolen, or declared off-road — but only if you do it correctly through the DVLA.
Thousands of drivers overpay car tax every year simply because they don’t realise how and when to cancel it. If you’re getting rid of a vehicle or taking it off the road, it’s not just a good idea to let the DVLA know — it’s your legal responsibility. And yes, it can lead to money back in your pocket.
But here’s the catch: you don’t get a refund automatically just because you’ve sold your car or stopped using it. The refund process is only triggered once the DVLA receives formal notice, and what you’re owed depends on timing. Miss the window, and you’ll lose a month’s worth of tax — even if the car’s gone.
There’s also confusion around who qualifies, how refunds are paid, and what to do if yours doesn’t show up. Worse still, many drivers don’t realise that once you’ve cancelled your tax, you can’t legally drive the vehicle again unless it’s retaxed correctly.
This guide breaks it all down — the steps, the rules, and the common pitfalls. If you want to stay compliant and get every penny you’re owed, here’s everything you need to know.
What is car tax and when can you cancel it?
Car tax, officially known as Vehicle Excise Duty (VED), is a legal requirement for most vehicles on UK roads — and you can only cancel it in specific situations like selling, scrapping, exporting, or declaring the vehicle off-road.
Car tax isn’t optional, and it doesn’t carry over when you sell your vehicle. Once registered in your name, it’s your responsibility — and your liability — until the DVLA is told otherwise. That’s why understanding when you can cancel it is just as important as knowing how.
There are five main scenarios where cancelling your car tax is both allowed and expected:
- You’ve sold your car — The moment ownership changes, the DVLA must be notified, and your tax ends automatically.
- The car’s been scrapped — If the vehicle’s been destroyed or dismantled, you can claim back unused tax.
- It’s been exported — Taking the car permanently out of the UK means you’re no longer taxed under UK law.
- It’s been declared off the road (SORN) — This means it’s not being driven or parked on public roads. Once SORN is in place, tax is cancelled from that date.
- It’s been stolen or written off — In these cases, if reported properly, you may be entitled to a refund for any remaining full months.
The DVLA doesn’t backdate refunds. So even if your car was scrapped two weeks ago but you only tell them today, you’ll only get a refund from the date they were informed. Timing matters — and acting fast protects your refund.
One thing worth stressing: you cannot transfer car tax to a new owner. Every time a vehicle changes hands, the new owner must tax it afresh. That makes cancelling your tax your responsibility the moment the car leaves your ownership.
Looking to compare car insurance? Get your quote today!
Get QuotesHow do you cancel your car tax through the DVLA?
To cancel your car tax, you must notify the DVLA either online, by phone, or by post — and the method you use depends on why you’re cancelling.
The process isn’t complicated, but it does vary depending on your reason for cancelling. For most drivers, the fastest and easiest way to do it is online, especially if you’re selling or have sold the vehicle. You’ll need a few details ready — the car’s registration number, your 11-digit logbook reference (V5C), and the date of change.
Here’s how it works:
If you’ve sold or transferred ownership, visit GOV.UK’s ‘Sell a vehicle’ service. Once submitted, the DVLA will automatically cancel your tax and trigger any refund for full unused months.
If you’re taking the vehicle off the road, you’ll need to apply for a Statutory Off Road Notification (SORN). This is also done online at SORN online, or via phone/post. Once processed, your tax ends immediately.
For scrapped, stolen, or exported vehicles, you’ll need to complete the relevant sections of the V5C logbook and return it to the DVLA. In some cases (e.g. write-offs), the insurance company may handle this for you, but it’s worth double-checking.
DVLA Contact & Methods Overview
| Cancellation Reason | How to Notify DVLA | Link or Form Used |
|---|---|---|
| Sold or transferred | Online via GOV.UK | Sell a vehicle |
| Declaring SORN | Online, phone, or post | SORN service |
| Scrapped or written off | Post (V5C) or handled by insurer | Return V5C to DVLA |
| Exported vehicle | Post (section 5 of V5C) | Send to: DVLA, Swansea, SA99 1BD |
| Vehicle stolen | Report to police & inform DVLA by post | Include crime reference and V5C |
No matter the method, make sure the DVLA has a valid address on record for you. Refunds are sent by cheque — and it’s only triggered once they’ve processed your change. If you delay, you risk losing part of your refund.
Why might you be eligible for a car tax refund?
You’re eligible for a car tax refund if your vehicle is no longer being used or kept on public roads — whether because it’s sold, scrapped, exported, stolen, written off, or officially declared off-road (SORN).
A refund is only issued when you cancel your car tax and there are full months remaining on your account. That part’s key — the DVLA won’t pay you back for a few unused days. But in the right circumstances, you can reclaim everything from the current month onwards.
Here’s a breakdown of the most common refund-triggering events:
- Selling the vehicle: The moment ownership transfers, you’re no longer responsible for the tax — but you only get a refund if you inform the DVLA promptly.
- Scrapping or writing off: If your car’s written off in an accident or dismantled at an authorised treatment facility, you’re entitled to claim back remaining tax months.
- Exporting the vehicle: Taking a car out of the country permanently also makes you eligible, provided you notify the DVLA with the correct section of the V5C.
- Vehicle is stolen: Once police confirm the theft and you notify the DVLA, you can request a refund. Again, it only applies to whole months left on the tax.
- SORN declared: If the car is no longer driven or parked on public roads, declaring it off-road (Statutory Off Road Notification) cancels your tax and triggers a refund.
- Change in tax class: If you become eligible for disabled exemption or another lower-rated class, the DVLA will refund your old rate once the change is processed.
Refunds aren’t issued automatically just because something happened to your car. You must tell the DVLA, and the refund is calculated from the date they receive your notice — not the date of the event.
Missing that distinction can cost you. For example, if your car is stolen on the 5th but you wait until the 20th to contact the DVLA, you won’t be refunded for that partial month. That’s why speed matters here, especially if a refund is expected.
Do you get a full refund or just a partial one?
You only get a refund for any full months of car tax remaining — the DVLA doesn’t refund partial months, no matter when in the month you cancel.
This often catches people off guard. Sell your car on the 2nd of the month? You’ve already lost the tax for that month. Cancel on the 30th? Same story. The DVLA doesn’t pro-rate Vehicle Excise Duty. They calculate refunds based on the number of whole unused months left on your tax, starting from when they receive your notification — not when the event occurred.
So even if you stopped using your car earlier, the refund clock doesn’t start ticking until you tell them. That’s why timing matters. A delay of just a few days can mean losing an entire month’s tax.
Here’s a working example:
Car Tax Refund Example
| Event | Date | Refund Calculation |
|---|---|---|
| Vehicle sold | 3rd April | DVLA informed 3rd April → Refund for May onwards only |
| Vehicle declared SORN | 20th July | Refund for August onwards → July not refunded |
| Car scrapped | 15th February | DVLA informed 25th February → Refund for March onwards only |
Refunds are always rounded down to whole months and sent by cheque to the registered keeper’s address. You won’t get it immediately, and if your address isn’t current, it may go missing entirely.
Also worth noting: direct debit payments stop automatically when you cancel. If you’ve been paying monthly, don’t expect a refund to be credited back to your account. Instead, you’ll simply stop being charged for future months.
How long does a car tax refund take to arrive?
Car tax refunds usually arrive within 6 weeks of notifying the DVLA — and they’re sent by cheque to the registered keeper’s address.
That time frame may sound generous, but most drivers receive theirs much sooner, typically within 2 to 4 weeks. The DVLA advises waiting the full 6 weeks before chasing it — and crucially, they won’t issue it unless all the required details are correct and the change of vehicle status is processed successfully.
Here’s how it typically plays out:
You inform the DVLA of a qualifying change (e.g. sale, SORN, write-off). They update your vehicle record. Once that’s confirmed, a refund is automatically calculated for any full unused months. A cheque is then posted to the address on the vehicle logbook (V5C).
But here’s where it can go wrong:
- Outdated address: If you’ve moved and haven’t updated the DVLA, your cheque goes to your old home.
- Wrong timing: If the DVLA processes your cancellation late in the month, you may have missed the cut-off for that month’s refund.
- Missing or delayed V5C return: If you’re scrapping, exporting, or declaring theft, and you fail to return the relevant section of the V5C, the refund may be held or cancelled.
DVLA Refund Timeline Overview
| Trigger | Typical Timeframe | Sent Via |
|---|---|---|
| Sale or SORN | 2–4 weeks (up to 6 max) | Cheque by post |
| Written-off or scrapped | 2–6 weeks (after insurer notifies DVLA) | Cheque by post |
| Exported or stolen vehicle | 4–6 weeks (depending on confirmation) | Cheque by post |
If your refund hasn’t arrived within six weeks, contact the DVLA. You’ll need your vehicle registration number, details of the event (sale, SORN, etc.), and ideally your V5C reference number.
And remember: the refund isn’t pro-rated. If the DVLA processes your change after the month has started, you won’t get that month’s tax back — even if you stopped driving the vehicle earlier.
What happens if you cancel your tax but keep driving?
Driving a car after cancelling its tax is illegal unless you’ve retaxed it — and doing so can lead to fines, clamping, prosecution, or even seizure.
This is one of the most common mistakes. A driver sells their car, or puts it under a SORN, or simply cancels their direct debit — and assumes they can “just finish the week” before dealing with formalities. The problem is, the moment your tax is cancelled or a SORN is issued, the car is no longer road legal.
The DVLA uses Automatic Number Plate Recognition (ANPR) cameras across the UK to check for untaxed vehicles. These are found on motorways, A-roads, and even fixed into traffic lights and bridges. If your number plate is flagged as untaxed, enforcement is almost immediate.
Penalties range from a £100 fixed penalty notice to a fine of up to £1,000. If the case goes to court or you’re caught repeatedly, your vehicle may be clamped or impounded, and you’ll have to pay release fees. Worst-case? The car is crushed.
Even if the car is parked on the street and not driven, it’s still considered “in use” unless taxed or declared off-road. That’s why SORN vehicles must be kept on private land — a driveway, garage, or secure yard. A public road, even if the car’s just sitting there? That’s a breach.
The DVLA doesn’t play softly on this. Their system is automated, and enforcement is frequent. The easiest way to avoid it? If your tax is cancelled, don’t drive the vehicle again until it’s retaxed and the DVLA confirms it.
Final thoughts
If your vehicle’s status changes — whether you sell it, scrap it, or simply stop using it — cancelling your car tax promptly is the only way to avoid overpaying.
The DVLA won’t chase you, they won’t issue a refund automatically, and they won’t credit you for unused days. You’re only refunded from the moment they’re informed — which makes acting quickly your best option.
Cancelling tax is about more than just saving money. It’s a legal requirement. If you forget to inform the DVLA, you could find yourself paying tax on a car you no longer own, or worse, liable for someone else’s actions behind the wheel.
It’s also a good time to look beyond the DVLA. If you’ve sold your car, taken it off the road, or are switching to something new, now’s the moment to review your car insurance. You might no longer need the same level of cover — or you might need to start fresh altogether.
Finally, remember the refund isn’t flexible. No matter how little you’ve used the car in a given month, you’ll only be refunded full months that remain after the DVLA processes your change. Let them know late, and you’ll lose out.
So, don’t put it off. If you’re no longer driving your car, take five minutes to update the DVLA — and make sure you’re not paying for something you can’t use.
Frequently Asked Questions (FAQs)
No. You must wait until the vehicle is sold and the DVLA has been notified before you cancel your car tax. Cancelling beforehand could leave you uninsured or in breach of your legal obligations.
You remain responsible for the tax until the DVLA is informed. If you forget, you won’t receive a refund and could still be liable for any fines or charges incurred by the new owner.
No. Vehicle tax can’t be paused or frozen. You must either cancel it via SORN or continue paying until a qualifying event triggers a refund.
There’s no strict deadline, but refunds are only issued from the date the DVLA receives your notice. Delay too long, and you’ll lose out on whole months of tax.
You can still contact the DVLA, but you’ll likely need to apply for a replacement V5C before proceeding. The logbook is required for most online and postal notifications.
No. Refunds are sent automatically by cheque to the registered keeper. Only they can initiate or receive the refund unless legal authority is provided.
If the DVLA has already issued a refund after you reported it stolen, you’ll need to retax the vehicle before using it again — even if it’s returned in working order.
Not directly, but if you declare a SORN and stop driving the car, you might want to update your insurer. Keeping insurance may still be wise for protection against fire or theft.