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 understanding trade plates, including costs, the application process, and more.
In this guide, we cover:
- What are trade plates?
- Who needs trade plates, and why?
- When to use trade plates
- Rules for trade plates
- How much trade plates cost
- How to apply for trade plates
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 motor trade plates and why?
If you’re a professional in the motor trade industry, you’ll likely benefit from trade plates. According to the DVLA, you’re eligible for trade plates if you are any of the following:
- 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. However, you will still need to tax brand new vehicles or second-hand cars already registered in your name—you can’t use trade plates on these.
When do you need to use trade plates?
Trade plates are issued for traders to complete specific tasks. Therefore, they are only to be used for ‘business purposes’ set out by the DVLA. These purposes include:
- Test 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 interesting 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 is to 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 is to be tested or inspected.
- Proceeding/returning from a place it is broken up or dismantled.
Here at Gallagher, we understand the importance of protecting your business when dealing with customer vehicles. Trade plates help you comply with road tax requirements. Still, specific Motor Traders’ Insurance is designed to protect you when you’re driving a car you don’t own for motor trade purposes.
Rules on using trade plates
You can’t use a trade plate on an unroadworthy vehicle, so if the car does not have a valid MOT, you’ll have to transport the vehicle 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 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.
Trade plates must be displayed in a vertical position, easily readable from 18-22 metres, and not be displayed inside the vehicle. That means that dealers, despite common misconceptions, 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 DLVA.
Cost of trade plates
Trade plates are relatively affordable, depending on when you apply. This is because licences must be for longer than six months and expire on the 30th of June or 31st December, you’ll likely get trade plate licences for between 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 |
| February | December | 11 months | £180 | £101 |
| March | December | 10 months | £165 | £92.60 |
| April | December | 9 months | £148.50 | £83.30 |
| May | December | 8 months | £132 | £74.05 |
| June | December | 7 months | £115.50 | £64.80 |
| July | December | 6 months | £99 | £55.55 |
| August | June | 11 months | £180 | £101 |
| September | June | 10 months | £165 | £92.60 |
| October | June | 9 months | £148.50 | £83.30 |
| November | June | 8 months | £132 | £74.05 |
| December | June | 7 months | £115.50 | £64.80 |
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 at 05.04.2022. Prices may change, please see the DVLA website for most up to date pricing: https://www.gov.uk/trade-licence-plates/apply
Applying for trade plates
To apply for trade plates, you’ll need to apply for a trade plate licence. 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 to get your licence. 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. These 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 will need to include a copy of your Motor Trader’s Insurance Certificate with your application. Remember, you can apply in 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 period of validity is for 12 months from a January application to the 31st December expiration date.
There you have it, a guide to getting a trade plate licence and help protect yourself from road tax issues when working as a motor trader. If you’d like to protect yourself from liability and keep customers, employees, and your own personal assets safe, contact our motor trade insurance team today.
