Diamond Extras

Scrapping the tax disc

The tax disc, as familiar to the British driver as rush hour traffic and road works, is set to become a thing of the past, as Chancellor George Osborne announced in 2013's Autumn Statement.

The jagged-edged paper circles have adorned UK windscreens since 1921, following its inclusion in the 1920 Roads Traffic Act, but from October the paper discs will be scrapped in favour of an electronic taxing system.

What that means for you

From October you will no longer need to display a paper disc in your car. Details of who has tax are already stored in a central database which police use to carry out registration checks on cars to see if they are taxed.

When the plan was announced it was met with a few nostalgic grumbles about the scruffy discs on our windscreen being something we'd all miss fondly. But generally people seem to agree that the idea of a policeman checking documents on a car windscreen, rather than it being done electronically, is a little archaic.

It also means drivers will be able to pay their road tax by direct debit for the first time which is expected to cost five percent more than paying it all in one go, but will make paying it a little bit easier.

Cutting out paper cuts costs

Scrapping the paper discs will save cash, and as you've probably already noticed most car insurers now do the same thing with regards to their insurance certificates.

Up until now drivers wishing to tax their vehicles would have needed to produce a paper copy of their insurance certificate. The new system allows these details to be cross-checked by the electronic database, saving you having to print out your certificate or requesting a copy from your insurer.

Problems for second-hand car sales

As it is all set to come into effect later this year you'd think any crinkles in the plan would have been ironed out. Well not quite.

Some are worried about the effect this will have when it comes to selling second-hand cars. In the past having six months left on the car's tax disc was used as a selling tool, however under the new rules that won't be allowed. The current owner would be expected to cancel the existing tax and the new owner start afresh.

This is where the new system falls down slightly. Current refund procedure only gives refunds for complete unexpired months; in the same way starting the tax requires payment for the whole month, even if you start mid-way through.

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