40 year rolling tax exemption

News broke early this year of the reintroduction of the rolling tax (VED) exemption scheme for classic cars, announced by the UK Government in the Spring Budget. A single year’s worth of exemption was announced last year for cars built in the 1974 calendar year, but it comes as a victory for the classic car industry as a whole that the rolling scheme is now reinstated, albeit with a 40-year rolling cut-off date. The original rolling 25-year exemption scheme was frozen in 1997, holding the cut-off date at 1 January 1973 for 16 years.


This reintroduction came following pressure and research conducted jointly by the Historic Vehicle Research Institute (HVRI) and the Federation of British Historic Vehicle Clubs (FBHVC), to which this Club is a proud affiliate. In their research paper The British Historical Vehicle Movement: A £4 Billion Hobby, they reported that the classic car movement in the UK is a rapidly growing industry that directly employs over 28,000 people, and contributed £4.3bn to the UK economy in 2011 alone: up from £3.2bn just five years earlier. Over 4.5 million people are now attending FBHVC affiliated classic car club events, compared to just 1.1 million in 2006 and 500,000 in 1997. It seems to be bucking all trends of economic downturn. A copy of this report is available for free download at www.fbhvc.co.uk/research.


Other pressure groups, notably Practical Classics magazine, have argued that the arbitrary cut-off date of 1 January 1973 was limiting the further growth of the industry by disincentivising the restoration of post-73 cars, and damaging the commercial values (and therefore preservation) of vehicles introduced after 1973. Such as the Rover SD1, Jaguar XJ-S and others, the survival rate of which is now disproportionately low compared to their predecessors that qualify for exemption status. An HMRC statement reported that the Government recognises the rolling tax exemption scheme as vital to the preservation of our motoring heritage, as well as supportive of this rapidly growing industry. We are all in support of this, and hope that the scheme continues to be in place indefinitely.


There is some confusion over the exact details of this scheme circulating the internet, but the Club has had sight of official HMRC documents that confirm that each calendar year of vehicle build dates automatically becomes exempt at the beginning of each financial year. In other words, cars built up to 1 January 1975 become exempt on 1 April 2015, up 1 January 1976 become exempt on 1 April 2016, and so on.

It is not year clear whether cars will automatically become exempt on 1 April each year, or whether you will have to submit a V10 form to the DVLA to have the car’s taxation class changed to ‘Historic’. We will endeavour to bring you this information as soon as it becomes clear.


Regardless, we can now look forward to the Rover P6 becoming an entirely tax exempt vehicle in four years’ time. This should ensure the better preservation of 2200 models, some of which (particularly TC’s) are now increasingly rare.


We were first to publish an article in Driving Force magazine to help you to identify whether your car qualified for tax exemption in 2013 based on its chassis number. We will be running similar articles every year until 2018 to help identify each year's batch of cars that should qualify for tax exemption.

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© The Rover P6 Club 2016