If you’re a motor trader, trade plates can save you time and money. These plates are placed over a vehicle’s original registration when it’s out on the road for a test drive or inspection. By removing the need to tax each vehicle individually, you can legally drive any vehicle in your possession.
As a motor trade insurance specialist, we’ve created a guide to help you understand trade plates, including costs, the application process, and more.
What are trade plates?
Motor trade licence plates are a DVLA offering that helps motor industry professionals save time and money by removing the need to tax each vehicle. When a vehicle is only temporarily in your possession, it’s not cost or time efficient to register each for road tax. Trade plates are exclusively for motor traders and vehicle testers when driving on the road.
Who needs traders plates and why?
If you’re a professional in the motor trade industry, you’ll likely benefit from trade plates. According to the DVLA, the following individuals are eligible for trade plates:
- Dealers, manufacturers, and repairers of vehicles (including collection and delivery agents)
- Manufacturers of trailers
- Valets and accessory fitters
- Vehicle testers
Trade plates bypass the need to tax each vehicle temporarily in your possession. They’re strictly for motor trade business use, and you can only use them on one vehicle at a time. The fine for misusing trade plates can be up to £5,000.
When do you need to use trade plates?
Trade plates should only be used for ‘business purposes’ set out by the DVLA. These purposes include:
- Testing or trialling accessories and equipment during manufacture, repair, or modification.
- Proceeding to or from a public weighbridge or by an inspection from a person acting on behalf of the Secretary of State.
- Testing or trialling for the benefit of a prospective purchaser, or for a person interested in promoting publicity.
- For delivering it to a place the purchaser will keep it.
- For demonstrating its operation when handing over to the purchaser.
- For delivering it from one part of the licence holder’s premises to another part or delivering/collecting between your premises to another manufacturer/repairer or dealer.
- Proceeding to or returning from a workshop where the car will be painted, repaired or valeted (excludes car washes).
- For proceeding to/returning from any premises of a manufacturer, repairer, or dealer where the vehicle will be transported by train, ship, or aircraft.
- For proceeding to/returning from any garage, auction, or any other place the vehicle is stored before or after it is offered for sale.
- For proceeding to/returning from a place where it will be tested or inspected.
- Proceeding/returning from a place it is broken up or dismantled.
Rules on using trade plates
You can’t use a trade plate on an unroadworthy vehicle, so if the car doesn’t have a valid MOT, you’ll have to transport it to an MOT centre. By law, vehicles must be insured too—we offer road risk insurance or motor traders’ combined insurance to meet legal requirements.
Trade plates are for motor trade use only. They should only be used for the purpose outlined on your application form and not for personal use in the evenings or outside of work.
Trade plates should only be used in the above instances otherwise outlined here on the DVLA’s website. If you’re planning to cease trading, you’ll need to surrender your trade licence and receive a refund of duty.
How to display trade plates
Trade plates must be displayed in a vertical position, easily readable from 18-22 metres, and on the inside of the vehicle. Despite common misconceptions, dealers can’t display plates behind the windscreen. They should be exterior to the car and must not cover the original registration plate.
To get your trade plates, you’ll need a valid motor trade insurance certificate and submit a copy of it with your application. That certificate must match the name on the application you submit to the DVLA.
Cost of trade plates
Trade plates are relatively affordable, depending on when you apply. This is because licences expire on the 30th of June or 31st December, so if you’re closer to the expiry date, the cheaper the licence will be. You’ll likely get trade plate licences for 7-11 months at a time*.
|Application month||Expiry month||Validity||Rate of duty for all vehicles||Rate of duty for bicycles and tricycles|
|January (6-month licence)||June||6 months||£99||£55.55|
|January (12-month licence)||December||12 months||£180||£101|
Costs vary depending on the month and can be viewed in full on the DVLA site. The maximum cost for a 12-month licence applied for in January is £180 for all vehicles or £101 for bicycles and tricycles. A 6 months licence in January will cost £99/£55.55.
*Prices correct as of 15.03.2023. Prices may change; please see the DVLA website for the most up-to-date pricing: https://www.gov.uk/trade-licence-plates/apply
Applying for trade plates
You’ll need to apply for a trade plate licence to get trade plates. The plates themselves are sent when your licence is granted. You’ll need to apply by downloading a form and then sending it to the DVLA. The form you need depends on your status, as there’s a form for people acquiring their first trade licence as well as those renewing or replacing theirs. The forms available are:
- VTL301 to apply for your first trade licence
- VTL318 to renew your trade licence
- VTL308 to surrender your trade licence (refund of duty)
- VTL310 to apply for a duplicate or replacement trade licence (or plates)
You need to include a copy of your Motor Trader’s Insurance Certificate with your application. Remember, you can apply any month, but costs are based on how long the licence is in effect against the 30th June and 31st December cut-off dates.
The maximum validity period is 12 months from a January application to the 31st December expiration date.
Protect yourself with Gallagher
There you have it—a guide to getting a trade plate licence and helping protect yourself from road tax issues when working as a motor trader. Contact our motor trade insurance today if you’d like to help protect yourself from liability claims and keep customers, employees, and your personal assets safe.