What The Government Website Says
Importantly, the relevant GOV.UK webpage starts with the reminder that you MUST always tax your vehicle, even if you don’t have to pay tax. It’s an important point. The website includes helpful links and information about eligibility, claiming your exemption and removing an exemption if a disabled person is no longer using it.
What’s The Position For Motability Scheme Members?
The good news for Motability Scheme customers is that your membership automatically ensures that you will be eligible for the car tax exemption on your leased vehicle.
How so? Well, it’s because, as a Motability customer, you are already receiving a qualifying mobility allowance. And that means you don’t have to pay VED. As part of your leasing agreement, Motability makes sure your car or Wheelchair Accessible Vehicle (WAV) is automatically taxed during your lease.
That said, if you’re a Motability Scheme customer and you have a second car, it’s useful to know you can choose to pay the tax on your Motability vehicle and use your exemption on your other car. This is handy if the VED banding on your own vehicle is higher than the Motability car, potentially saving you as much as £600 a year if it's in band M.
Criteria For A VED Exemption
No article about the UK VED exemption would be complete without summarising the criteria determining your eligibility as a disabled driver. It all comes down to whether you receive one of the following mobility allowances. If you can answer ‘yes’ to any of these, you’re likely to be eligible:
- Are you currently receiving the Enhanced Rate of the Mobility Component of Personal Independence Payment (PIP)?
- Do you get the Higher Rate Mobility Component of Disability Living Allowance (DLA)?
- Receive the higher rate mobility component of Child Disability Payment (Scotland)?
- Are you in receipt of the War Pensioners’ Mobility Supplement (WPMS)? This benefit is paid along with War Disablement Pension to help with additional mobility costs associated with war service disabilities.
- Do you qualify for the Armed Forces Independence Payment (AFIP)? AFIP is a benefit that financially supports service personnel and war veterans who were seriously injured during their military service.
Having established your eligibility, you need to claim your car tax exemption. Remember, if you have a vehicle through the Motability Scheme, the exemption will have been taken care of for you. If not, here’s how it works…
How To Claim Your VED Exemption
If you aren’t benefitting from the exemption through Motability and you own your own car, you’ll need to apply for the exemption yourself when you apply for your VED.
The first time you claim you’ll need to do this in person at a post office that offers vehicle tax services (not all do).
You’ll need to take your ‘Certificate of Entitlement’, an award letter from your benefit payment agency that proves your entitlement to a tax exemption plus the V5C vehicle registration certificate and the MOT certificate (if it's over 3 years old).
If you are buying a new car from a car dealer, just take your ‘Certificate of Entitlement’ with you to the dealership so they can set up the VED correctly and change the tax class of the vehicle to 'disabled' before you take delivery.
As soon as this is done the vehicle will be registered in the Disabled Taxation class.
For following renewals, you can go to the post office again or simply do it all online. If you will be away from home (perhaps on holiday) when your tax expires, it's good to know that you can renew it up to two months before the expiry date.
IMPORTANT: Please note that the vehicle must be registered to you or in a nominated driver’s name. And that the nominated driver mustn’t use the vehicle for personal purposes. If a disabled driver tax exemption is in place, it can only be used for your benefit.
Can I Swap The Disabled Tax Exemption To Another Car?
This is one of the most often asked questions about the VED exemption for disabled drivers. So here’s the answer:
Much as we get to love our cars, the time may come, after a few years, for us to change them. Maybe you just fancy a change of make or model, or you’re taking the plunge and moving to an electric vehicle.
As an existing holder of a VED exemption, you may think that you can easily transfer the exemption from your old car to the new one. Alas, that’s not possible. If you get a new car, or if the registered keeper changes, you’ll have to go to a post office again and make a new application for free vehicle tax.
Similarly, the only way to change a vehicle’s tax class from ‘Disabled’ is to apply at a participating post office.
Can A Blue Badge Holder Get Free Road Tax?
Another frequently asked question concerns whether Blue Badge holders automatically get free road tax. Many Blue Badge holders are also eligible for a VED exemption, but they would also have to meet the same eligibility criteria set out above. If you don't qualify for the full tax exemption, it's possible you could still be eligible for a 50% reduction. If in doubt, we recommend that you consult your benefits agency or the local authority responsible for issuing the badge.
50% Vehicle Road Tax Reduction
If you don't qualify for a full exemption, you could still get a 50% reduction in the cost of your vehicle tax if you get the Standard Rate mobility component of Personal Independence Payment (PIP) or the new Adult Disability Payment (ADP) standard rate mobility component (in Scotland only).
To find out more about claiming the 50% reduction, visit the GOV.UK website.
Next Steps With Your VED Exemption
VED exemption isn’t a particularly complicated aspect of benefits for disabled drivers. However, if you do have any further questions, plenty of advice is available.
Your benefits agency is one starting point and Motability is another. And, of course, the GOV.UK website is always there with the definitive word on how to make use of this valuable disability benefit.
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