Bought vehicle into trade TOYOTA Corolla IX Hatchback (E120) (01.2001 - 12.2007)

As you've recently acquired a 2005 Toyota Corolla with the intention to trade it, understanding the tax implications and the process for transferring registration in the UK is crucial.

Tax Implications
When trading a car in the UK, the primary tax implication for you as a private individual is generally limited to Value Added Tax (VAT) if you are registered for it and are selling the car as part of a business. However, for most private sales, there is no capital gains tax on personal possessions like cars.

When you sell the car, your vehicle tax will be automatically cancelled once you inform the Driver and Vehicle Licensing Agency (DVLA) of the change of ownership . The new keeper will then be responsible for taxing the vehicle in their name .

UK Registration Transfer Process
Transferring car ownership in the UK is a legal requirement managed by the DVLA . The current registered keeper must inform the DVLA as soon as the vehicle changes hands . This ensures the correct person is responsible for road tax, legal notices, penalties, and official mail . Failure to update the DVLA can leave the former keeper liable for fines, unpaid tax, or enforcement actions .

The process can be completed online or by post:

1. V5C Logbook (Registration Certificate)
- The V5C, or logbook, is the most important document for transferring ownership .
- As the seller, you will need to fill out section 2 of the V5C form with the new owner's name and address .
- You must then fill out and detach the new keeper slip (section 6 of the V5C) and give it to the new owner .
- The remaining part of the V5C, including the completed section 2, must be sent to the DVLA .

2. Notifying the DVLA
* Online Transfer: This is generally quicker and easier .
- You will need the 11-digit reference number from the V5C logbook and the new owner's details .
- Visit the official UK government website to "Tell the DVLA you’ve sold, transferred, or bought a vehicle" .
- Complete the online form, and you can include the new owner's email address for confirmation .
- Once submitted, you'll receive email confirmation, and the new keeper should receive the updated V5C logbook within five working days .
* Offline Notification (by Post):
- You will send the completed V5C form (excluding the new keeper slip) to the DVLA by post .

3. Vehicle Tax
- Before transferring ownership, ensure the vehicle tax is up to date .
- The buyer must tax the vehicle in their name, which can be done online, by phone, or at a Post Office offering the service .

Avoiding Potential Pitfalls
- Inform DVLA Promptly: Notify the DVLA as soon as the car is sold to avoid being held responsible for fines or other issues after you no longer own the vehicle .
- Retain the New Keeper Slip: As the seller, you must give the new keeper slip (section 6 of the V5C) to the buyer .
- Verify Vehicle Status: While not directly part of the transfer process for you as the seller, conducting a car history check is generally recommended for buyers to verify the vehicle's status .
- Lost V5C: If the V5C certificate is lost, the new owner will need to fill out a V62 form to apply for a new registration certificate .