Vehicle Excise and Registration Act 1994 section 13

Trade licences: duration and amount of duty

Section 13 sets out the permitted durations for trade licences and the rates of vehicle excise duty payable for each duration, including adjustments for instalment payments.

• Trade licences can be taken out for a full calendar year, six months (starting January or July), or — for new traders or those without an existing licence — for seven to eleven months starting on the first of certain other months.
• The annual duty rate depends on the type of vehicles covered: it is the motorcycle rate if the licence is used only for motorcycles, or otherwise the basic goods vehicle rate (being the rate for a rigid goods vehicle with a revenue weight over 3,500 kg but not exceeding 7,500 kg).
• A six-month licence costs 55% of the annual rate (or 52.5% if paid by direct debit under an instalment agreement), and licences for seven to eleven months are calculated as 55% of the annual rate plus one-sixth of that amount for each additional month beyond six.
• Where an annual licence is paid by instalments under a direct debit agreement, the total duty is 105% of the annual rate, and all calculated rates are rounded to the nearest 5p.

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