Last month we collected our new motability car, but temporarily still have our previous (non-motability) car. Due to my wife’s disability, we didn’t have to pay for car tax on the old car. Am I right in thinking that now we have a motability car, car tax will become payable on the old car? If so, it doesn’t seem to be an automatic change, as it still shows as taxed on the gov.uk site. Thanks for any clarification.
You are only allowed the free disabled tax on one vehicle at a time. Generally it will be the Motability vehicle, but if the tax on the Motability vehicle would be less than on your own vehicle, you can switch it around by initially speaking with Motability, then visiting a Post Office to change the taxation class on your own vehicle.
You are responsible for dealing with the taxation on your own vehicle if you now have your Motability vehicle with the free road tax. You will need to change the taxation class on your own vehicle and pay for the road tax (or declare it as SORN (off road). You can change the taxation class at Post Offices that deal with road tax. There is no automated or ‘online’ system for this. You may have to pay the back tax so there was no overlap with the free tax on the Motability vehicle.
https://www.gov.uk/change-vehicle-tax-class/tax-due-to-run-out-or-changing-if-vehicle-is-exempt
If you have two vehicles registered to yourself, both with free road tax, eventually the DVLA will pick this up. What action they then take is up to them, but you could end up paying a penalty or even a fine along with any back tax owing. Hence it is in your own interest to sort it out asap.