Update on VED exemption extension

The 12 month VED exemption extension (from 1st January 1973 to 1st Januray 1974) was announced in an HM Treasury support document released promptly after the Budget 2013 statement in Parliament. The document stated the NIL value road tax disc concession would apply from 1st April 2014 for cars "built" before 1st January 1974.

Since that announcment we have been trying to obtain clarification as to how the DVLA will process an application to change the status of an eligible car from PLG to "Historic". We have also sought clarification of the proecedure for claiming a NIL value tax disc for the first time on and from 1st April 2014. So far we have seen no clarification and 1st April 2014 is approaching rapidly.

A quite separate but related matter arose in the Mini Budget in late 2013 when an announcement mentioned the end of the paper tax disc from 1st October 2014.

See our previous NEWS items on these topics. More

Posted: 140214

The essential clarifications owners of classic cars eligible for the VED exempt status are seeking are:

What is the procedure for changing the vehicle class from PLG to Historic? We need clarification of the what, when, how and where.

What will be the procedure for applying for a NIL value tax disc? Again clarification of the the what, when, how and where is needed.

For an owner with a car "built" in December 1973 how does he or she go about each stage and are they separate applications or would you have to submit a combined application for both the status change and disc? We need clarification of when we may apply for the change of status and what documents (including any DVLA forms) do we have to send with our application, what evidence of the "built date" do we need to send (for example an original of a certificate from BMHIT showing the "Date through Paint Finishing" which the BMHIT archivist says is the built date accepted by
DVLA for the MGBGTV8 model and presumably the original of our present V5C) and what fee (if any) is payable? Then once we have our car with Historic status on the V5C how and where do we apply for the NIL value disc and are the two processes separate or will they be combined?

At present there is no clear information on these essential procedures. We will continue to try and get the clarifications.

When will the VED exemption extension be incorporated in the Finance Act?
A concern raised by fellow member Mike Dunlop in October 2013 was he had found the VED exemption extension provision had not been included in the Finance Bill that had reached Royal Assent stage of the parliamentary process in July 2013. On re-reading the announcement of the VED exemption extension in section 2.148 of the support document released by HM Treasury promptly after the Budget statement in March 2013, we noted that section mentioned "Finance Bill 2014". So presumably the provision will be included in the Finance Bill to go through Parliament following the March 2014 Budget. The FBHVC agrees and says "it is our understanding that the Finance Act 2014 will include the necessary clause to enable the VED exemption date change."

That still leaves a concern that the Finance Act 2014 will probably not reach Royal Assent until July 2014 some 3 to 4 months after the 1st April 2014 when the VED exemption extension is due to begin. Our understanding of Parliamentary process is the exemption for vehicles manufactured before 1st January 1974 will come into force on 1st April 2014. Although the Finance Bill 2014 will not come into force until it receives Royal Assent (which is usually sometime around the middle or end of July 2014), sometimes HM Treasury require vehicle tax rates changes to take immediate effect or from 1st April before the Finance Bill becomes law. In this case, Budget Resolutions are passed in the Commons immediately after the Chancellor’s Budget statement. The resolutions (made under the Provisional Collection of Taxes Act) give immediate legal power to make the tax rates changes.

Classic Car Weekly ran a news item in its latest issue commenting on the "growing number of enquiries from readers confused about changes to tax exemption for historic vehicles". Later in the piece it said "DVLA has this week confirmed to CCW that the planned changes to historic vehicle exemption are still taking place, with pre-1974 classics exempt from 1st April 014". It then mentioned a comment from a "DVLA spokesman" that "from 1st April 2014 a vehicle manufactured before 1st January 1974 will be exempt from paying vehicle excise duty. Vehicle keepers need to complete a V70 form, the application to exchange a vehicle tax disc. Then they need to send the competed form and accompanying documentation to DVLA Swansea."

Unfortunately, so far as we can see, the V70 form makes no mention of the need for documents supporting a change of class, like a build date certificate, and it is puzzling this form is suggested as the form to be used because previously form INF34 had been used. Again we are seeking further clarification.
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