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Well the day has finally come. After 5 Motability cars, we have handed the last one back (early termination) and left the scheme. There have been a number of challenges in the process of transitioning back from Motability to a private vehicle and, as quite a few people are leaving the scheme (or considering doing so when their current lease ends), I thought that it might be useful to share my experience, and what I’ve learned along the way, in the hope that it might help others.
There would be way too much info for a single post, so I will split the info across a number of posts covering the multitude of different issues that we faced.
In this first post I shall address the subject of Disabled VAT exemption. As you may know, Motability have a block VAT exemption on the basic vehicle cost of all cars purchased for the scheme. The rules for private new car buyers are more complex. If the disabled person is a full time wheelchair user and requires a ‘substantial and permanent’ adaptation to the vehicle then the car can be purchased VAT free. However, both criteria must be met. A scooter user, or someone who uses a wheelchair but only occasionally will not qualify. A permanent and substantial adaptation is something that is bolted into the car and / or the cars electrical system and cannot be easily removed. My wife is a full time wheelchair user and requires a person hoist, so we qualify for VAT exemption on a new car (once every 3 years max).
Initially when I looked into this issue I interpreted the guidance as meaning that the car had to be registered in the name of the disabled person. This is not the case. A nominated driver (myself in this case) can purchase the car with their own money ex VAT and have the car registered in their own name, as I have done. There is a simple 2 page self declaration that you fill in and hand to the supplying dealer. This form has a section which allows you to state the nominated person if it’s not the disabled person.
The next issue is that, as with Motability, the rules suggest that the car can only be used for the specific benefit of the disabled person. This is to deter abuse but, as with Motability, there is some discretion on this. I was very up front with HMRC and had the same conversation with them as I’d had with Motability a few years earlier. I explained that as we are retired and my wife cannot drive, we only need one car. Consequently, there are regular occasions when I use the car for reasons that are not for my wife’s direct benefit, such as visiting family and friends etc. They assured me that this is absolutely fine but, for peace of mind, I got them to put this in writing for me, which they kindly did.
There is a very good helpline for VAT exemption enquiries – HMRC Charities Helpline tel 0300 123 1073 (0900-1800 M-F).
The final issue with VAT exemption is that, for reasons that are beyond me, not all car dealers will allow VAT free purchases. I live between two main BMW dealers. One will process VAT exempt sales and one won’t. Guess which one got my business?
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@kezo I agree that we are going around in circles and in the absence of written confirmation from HMRC that dealers are legally compelled to offer VAT free sales, we should assume that they are not. Relying on the interpretation of a word isn’t going to force any dealer to comply if they don’t want to.
Yes, Mrs GG loves the X5 as well. She is also very pleased that every single person who has seen the car has commented on what a lovely colour it is – as she chose it!
I’m sure that you are right about the demonstrator. I must confess that I ‘drove it like I’d knicked it’ during some of the time that I had it, and I guess that anyone considering a high performance car is going to do the same. Whether it’s people like me who haven’t had an M Performance BMW model before and are trading up to one, or others who may be trading down from a full fat M car to something more suitable for daily use, I guess that people will want to check out the full performance range!
I think that the other factor is that, for reasons best known to BMW, they always understate the power, 0-62 times and fuel economy of their cars. From memory, almost every BMW that I have owned I have achieved better mpg than the stated average. In the case of the X5 M60i, BMW quote a power output of 530 hp (plus you get around a 30 hp boost from the ‘Sprint’ function), but the car has been proven to actually output between 600-610 hp. As for 0-62mph times, BMW quote 4.3 seconds, yet at least two different reviewers have achieved 3.6 seconds. I think that some of the understatement is to justify the price premium of, in this case, the X5M, which has the same S68 twin-turbo V8 engine, but in a higher state of tune.
As for mpg, the official figure is 23.7 mpg and I’m smashing that, albeit I only use Sport mode infrequently for a bit of fun when the mood takes me. I guess if I was using anywhere near the full potential of the car most of the time I would be well below the official figure – and probably would have lost my driving licence by now 😂. It may well drop in the winter, but the fact that I can get such good economy at all is a welcome benefit that I just hadn’t expected or allowed for. Having agonised over whether to go for the ‘sensible’ choice of the 40d or the ‘indulgent’ choice of the M60i, I am very pleased that I went for the latter!
Although most of the commentary of late has been about VAT exemption, those who have followed my journey away from Motability from the start will know that, once I found a dealer willing to process a VAT free, this aspect was dead simple.
By contrast, getting the VED exemption switched from the Motability car to a private car was a nightmare and, to a degree, is still ongoing. By way of background, on 1st May I paid Motability £640 for 12 months VED on our Motability car. This required them (via the DVLA) to change the taxation class on the Motability car from ‘Disabled’ (VED exempt) to regular (VED payable). There were delays at both the Motability end and DVLA in processing this, which meant that I had a battle with DWP to issue us with a ‘Certificate of Exemption’ for use on our new private car and I only got it after kicking off with them after about 4 attempts. Thankfully I finally received it with just days to spare before we took delivery of the new car on 24th June. Had I not received it I would have had to pay the first year VED of £5,690 and then claimed back a pro rata refund at a later date having altered the taxation class 😱
Having overcome that hurdle, within days of returning the Motability car we received a notification from DVLA saying that my wife was no longer the registered keeper and that any pro rata refund of VED would arrive within 4-6 weeks. Last week marked 7 weeks from when we returned the car and we hadn’t received the pro rata refund of approx £533. I called DVLA who said that the refund did not appear to have been processed yet 🙄.
I registered a complaint about the delay, but then thought that I’d check with Motability just in case the refund was going via them, even though DVLA hadn’t said that it would. Having been put on hold whilst an accurate answer was established, it turns out that the pro rata refund will indeed come from Motability and not DVLA. The good news is that Motability are much better to deal with (and chase) than DVLA, but the bad news is that it takes them up to 12 weeks to process the refund 🙄
As with many of these issues, the challenges occur during the first time that people move away from Motability to a private car, and subsequent vehicle changes will be a doddle in comparison.
One other development is that my wife is now receiving the additional £320 every 4 weeks that was previously going straight to Motability, and we are diverting that into a savings account which we set up to cover any running costs of the new car, but given the warranty (which I extended to 5 years), the service inclusive plan (also 5 years) and tyre and alloy insurance (4 years) I hopefully won’t need to dip into that very much, so the balance in 3-5 years time will be added to the trade in value of the car to fund our next car purchase.
@Glos Guy
With the VED would you have to do the same if you were doing it back to back: returning your Motability car and getting your privately owned one next day / within a short number of days?
As to the extended warranty, service and tyres, I understand the service part. But as to the warranty I struggle to get clarity from a couple of dealerships what is included and who will be honoring it: the dealership or the manufacturer. Any tips here, please?
Also I didn’t understand the bit with the tyres – is it part of the maintenance plan?
Many thanks.
Sent from a mobile device.
Apologies for briefness and spelling mistakes.Motability Skoda Enyaq SportLine 85x April 2024 (unhappy customer, but won my case with Ombudsman)
Motability Mazda CX-60 PHEV July 2023 (unhappy customer - early termination on mechanical grounds)
Motability VW Touran Family Pack May 2019 (happy customer)@Glos Guy With the VED would you have to do the same if you were doing it back to back: returning your Motability car and getting your privately owned one next day / within a short number of days? As to the extended warranty, service and tyres, I understand the service part. But as to the warranty I struggle to get clarity from a couple of dealerships what is included and who will be honoring it: the dealership or the manufacturer. Any tips here, please? Also I didn’t understand the bit with the tyres – is it part of the maintenance plan? Many thanks.
I actually did a back to back changeover, in that I left the Motability car with the dealer that supplied my new car on the day that I took delivery.
The complication arises the first time that you leave Motability, as we don’t have the required ‘Certificate of Exemption’ that you need to apply VED exemption to your private car, as DWP won’t issue them whilst you are still a Motability customer.
I thought that by paying the VED on the Motability car a couple of months early, thus removing the disabled classification of the car, (which was a very easy process through Motability), I would be able to get DWP to issue the certificate, but they were really unhappy doing so whilst we were still in possession of a Motability car, even though I kept on explaining to them that we had surrendered the VED exemption on the Motability car so were entitled to a certificate to apply to our new private car . They just didn’t get it, and it was only when I lost my patience with them (on around the 3rd or 4th attempt) that I finally got hold of someone who could override their system – and the certificate arrived the next day!
The key thing to look at, in order to determine how much of an issue this may be, is to compare the current annual VED charge on your Motability car with the first year VED charge on your new private car. Don’t forget to include the surcharge if the car is over £40k (£50k EV). If the new car is a lot more, it’s worth doing what I did. If there’s not much difference, do nothing until you get your new car. Once you have your V5 (sent automatically by DVLA) and certificate of entitlement (which you have to request from DWP), you simply go to a Post Office and apply for the exemption to be applied to your new car. You will receive a pro rata refund of full unused months from DVLA .
The reason why I didn’t do this was because my new car is in the highest VED class, with a first year rate of £5,690. It was therefore well worth my while to pay two months worth of VED on the Motability car (which cost me £105) so as to avoid paying for even 1 month on the new private car (which is £474 per month).
With my BMW, I get a 3 year manufacturer warranty which, as with all manufacturer warranties, includes break down cover as well. I intend to keep the car for a minimum of 3 years (as that’s the earliest that I can buy another car VAT free) and a maximum of 5 years. As it’s a very expensive car with a high performance engine and expensive to repair options like air suspension, I wanted to make sure that I was protected with a warranty for the duration of my ownership. BMW do year by year cover once the 3 year warranty has ended, but when I priced it I was looking at £1,850 per year (probably £2k Pa by the time the car is 3 years old). By contrast, my supplying BMW dealer (who I would use anyway) offered a warranty for the 4th and 5th years at a price of £1,399 (total for the 2 years) as long as you bought it within 14 days of taking delivery of the car. I checked what was covered and it was essentially mirroring the manufacturer warranty (engine, gearbox, electrics, suspension etc etc). Unlike the service inclusive plan it’s not transferable, so if I sell the car at 3 years I’ve wasted £1,399, but I decided that it was a good price and gave me peace of mind.
The tyre and alloy wheel insurance was also through the dealer and was a stand alone policy. It cost me £510 for 4 years and gives me up to £200 each for up to 10 x alloy wheel repairs or replacements, unlimited tyre repairs and up to £250 each for up to 5 tyre replacements due to punctures, damage or vandalism. Given that the tyres for my car are up to £350 each and my 22” alloys are vulnerable to kerbing, this was another purchase for peace of mind.
That’s brilliant. Thank you, @Glos-Guy.
Sent from a mobile device.
Apologies for briefness and spelling mistakes.Motability Skoda Enyaq SportLine 85x April 2024 (unhappy customer, but won my case with Ombudsman)
Motability Mazda CX-60 PHEV July 2023 (unhappy customer - early termination on mechanical grounds)
Motability VW Touran Family Pack May 2019 (happy customer)@Callmejohn What was the final answer that you got from HMRC when you challenged the fact that many dealers refuse to process VAT exempt new car sales?
@Callmejohn What was the final answer that you got from HMRC when you challenged the fact that many dealers refuse to process VAT exempt new car sales?
@Glos-Guy, I didn’t get a final answer from HMRC, as despite them giving me a callback booking from a so called “technician”, on the 20th of last month, they never got back to me. As they were only one of the subjects on my to do list and it did not actually affect me personally , I never chases it up. But I still maintain they are not right to refuse disabled people the right to claim zero rate of vat, or charge them at 20% vat either, when they meet the qualification rules, for zero vat, under HMRC Law or refuse to sell to them, under the Equality Law 2010.However after further investigation, I think, why the problem is with only the two German dealers, was possibly that there had been a vat problem between German Manufacturer’s and Portuguese Dealership’s, which seemed to be cars being supplied to the dealership’s marked as different cars and differently priced to what was actually supplied, which in turn had the wrong amount of vat paid.
This ended up at the European Court of Justice and the German Manufacturer’s getting their figures burnt.
So even though we are no longer under the jurisdiction of the ECJ, it may well explain why these two German makes and only these two makes are now playing, what they consider safe. Even though, their actions could be challenged in this country.
Small update on my ongoing issue with DVLA.
Having returned our Motability car on 24th June, for which I had voluntarily payed 12 months VED from 1st May in order that I could avoid the enormous first year VED (showroom tax) on my new private car , I have still not received the pro rata refund of the remaining 10 months.
I raised a formal complaint with DVLA on 14th August and have today received a reply. They have said that the vehicle was noted as “not eligible for automatic refund” but they couldn’t say why! They say that, as a result. they manually issued a refund on 27th August, so I should receive it ‘soon’. As to whether I will receive it directly or via Motability I don’t yet know (they didn’t say) but when I last spoke to Motability they said it would be via them and to chase them on 29th September if I haven’t received it by then 🙄.
Having gone into this thinking that the VAT exemption would be the biggest hurdle, that turned out to be a doddle. As for VED, which I assumed would be straightforward, I hadn’t allowed for the incompetence of the DVLA! Thank goodness that these issues are only endured the first time that you move away from Motability.
On a more positive note, it’s a nice feeling now that everything is now in my name – the car, insurance, private plate etc – as since I sold my last private car around 6 or 7 years ago everything has either been in Motability or my wife’s name. Whilst I retain an active interest in Motability, it’s also a relief to know that we are unaffected by any future degradation of the scheme and everything is now 100% within our control. It’s quite liberating!
Excellent news Glos Guy, so glad to hear almost all sorted.
I am now just at stage of 1 yr of my own car ownership, so just renewed insurance which this year is now half the price of what i paid last year and also now have my no claims protected. Last year only one company would insure me through a broker, this year one quote comparison site has block for medical licence and ability to give me direct online comparison quotes
VED was very easy to renew online, just entered NI number and automatically accepted my declaration for disabled class.
Also having done 18k miles just replaced all my tyres. Glad i took out the tyre insurance as within 150 miles bit of road debris gashed tyre. So that was replaced FOC.
Cars On Motability
2009 Citroen C4 Grand Picasso
2012 Vauxhall Antara
2013 Skoda Superb Estate
2016 Seat Alhambra
2020 Seat Tarraco
2021 Ford Kuga
2024 Nissan X-Trail left in Sep 25
Own 2025 Vw California Ocean eHybrid 4MotionThanks @HoneyMonster I’m delighted to hear that your first year away from the scheme has been so successful.
Given the value of my car (and the ‘new for old’ cover you get during the first year), the fact that it’s in the highest insurance group (50) and I had lost all my No Claims whilst we only had a Motability car, I was braced for a first year insurance quote of many thousands, so the fact that a good half a dozen good insurers quoted in the £700-800 range staggered me. I can only assume that my age, the fact that we live in a low risk area and the car is parked in a garage all helped significantly.
I have heard from a few people that VED renewal is a doddle, and I recall it was dead easy before we joined Motability.
Like you, I’ve taken out tyre (and alloy wheel) insurance as the tyres are £350 each!
I’m chucking the PIP that we were previously gifting to Motability into a separate account for any unexpected costs, although with a 5 year warranty & 5 year servicing plan, in addition to the tyre & alloy insurance, I’m not expecting many, so it can cover insurance and build up a deposit for the next car. In what seems like no time at all, it’s already up to £750 and will continue to grow at £320 every 4 weeks plus interest 👍
Surely this car must be costing you way more than Motability as I have looked into it and unless its a cheap low range car you cannot beat Motability for piece of mind still. And not only that you would have to have high income and good credit rate to consider options.As to choice with certain makes and choice gone it is a sad day what has happened and there is the VAT thing which is very bad for affordability and if I could afford to not go onto Motability probably I would.
Some AP costs are now too high but the MG3 hybrid at £499 is very good although it is not my cup of tea.
Some AP costs are now too high but the MG3 hybrid at £499 is very good although it is not my cup of tea.
The MG3 Hybrid is £299 AP currently.
It is also currently available at many MG dealerships on offer at Nil AP as per the deals & offers thread.
Surely this car must be costing you way more than Motability as I have looked into it and unless its a cheap low range car you cannot beat Motability for piece of mind still. And not only that you would have to have high income and good credit rate to consider options.As to choice with certain makes and choice gone it is a sad day what has happened and there is the VAT thing which is very bad for affordability and if I could afford to not go onto Motability probably I would.
The car that I have bought is more than double the price of the most expensive car available through Motability, so it’s not comparable. I do have a good credit rating, but this wasn’t relevant as I bought the car outright rather than using finance.
The issue that we had was that there wasn’t a single car available through the Motability scheme that even remotely appealed to us. If there had been we might have stayed, even though the scheme is no longer the ‘no brainer’ that it used to be from a cost point of view. I agree that Motability gives peace of mind, but at a high cost.
I still have peace of mind with my new private car. I have a 5 year warranty which includes breakdown cover, 5 year servicing plan, tyre and alloy wheel insurance and affordable insurance. I am also unaffected by any of the issues now causing concern to many Motability customers – mileage restrictions, excess mileage charges, VAT on APs (and maybe the whole lease if last weeks proposal happens).
Naturally I didn’t buy a high value luxury performance vehicle expecting it to cost me the same as the sort of cars available through Motability. The two aren’t even remotely comparable, so that would be daft. However, if I’m still participating in this forum when I eventually sell the car, I shall publish the whole life running costs and I’ll put money on the fact that the difference won’t be more than double the cost of the most expensive Motability cars.
The last time I ran a private car (a BMW 5 Series) I bought it new at the same time as we ordered a new VW Tiguan through Motability. The whole life costs of both cars worked out almost exactly the same, yet obviously the 5 Series was the far better car. At that time we didn’t qualify for VAT exemption on the private car, whereas we got full exemption this time, and the APs with Motability at that time were less than half what they are now, so I think that the comparative figures next time will be an eye opener!
Surely this car must be costing you way more than Motability as I have looked into it and unless its a cheap low range car you cannot beat Motability for piece of mind still. And not only that you would have to have high income and good credit rate to consider options.As to choice with certain makes and choice gone it is a sad day what has happened and there is the VAT thing which is very bad for affordability and if I could afford to not go onto Motability probably I would.
Depending on your condition and whether you require a vehicle that is permanently & substantially adapted, you can be exempt from paying VAT on a new vehicle.
If yot take the MG3 Hybrid mention. A pre reg Trophy (essentially a new car with delivery miles) can pe purchased with anyout negotiating for £20,500. You then drive it for six years, before selling it, with the remaining 1 year warranty left. Not only will there be the residual value left in the car when you sell it, but you would have essentially saved £26,000 in sacrified benefits, not only making the little MG cheaper motoring, but making cars like @Glos-Guys far more apealing, if you have the means and credit rating, if buying on finance to do it.
Kezo been there done it never made any profit from cars since buying my own first car in 1979 lost so much money as changed my cars every year but I did at least keep up with price changers. Learned my lesson and Motability has been a lifesaver for me with my disability and although the changers are not good I still will stick with what I know. I mean with my luck buying my own car again whether new or second hand a warranty on most cars even MG and kia warranties have so many get out clauses one being wear and tear is one some people have had so much trouble even motability customers as read on here and if a warranty or Manufacturer decides we not fix something a warranty means nothing youtube videos show this new cars now are more unreliable mostly electrics what car says but they can be off the road a long time. At least motability you hope will sort things out as they did with my troublesome Fiat Punto back in 2002 that was electrical.
VED Update – I am pleased to report that a cheque for £533.33 (representing a pro rata refund of the 12 months VED that I voluntarily paid on our Motability car, in order to avoid the £5,690 1st year VED on our new private car 😰) finally arrived in the post today.
This was the final remaining issue that needed resolving following our transition away from Motability. Free at last! 😂
Your unshackled now, which is great news!
Indeed 👍 It’s quite liberating isn’t it? 😂
VED Update – I am pleased to report that a cheque for £533.33 (representing a pro rata refund of the 12 months VED that I voluntarily paid on our Motability car, in order to avoid the £5,690 1st year VED on our new private car
) finally arrived in the post today. This was the final remaining issue that needed resolving following our transition away from Motability. Free at last! Good to hear that.
It should be plain sailing taxing the car as disabled annually from now.
At last I can drive my X6 following my knee surgery now, having been given the all clear to resume driving by the surgeon yesterday. It has been parked up in an empty grain store since I drove it straight from the dealership in June, immediately prior to surgery.
It will have its first proper run out early next month, down to Heathrow where it will be parked up again for another 8 weeks! It must the the 3 month old X6 with the lowest mileage ever!
Dave
Glad to hear that you are on the mend @BigDave
Give it a good blast on the way to Heathrow to keep that DPF filter clear!
I’m delighted with the X5. It’s even proving to be a lot cheaper to run than I’d anticipated, which is an added bonus – especially as fuel economy was the last thing on my mind when I ordered it 😉
Glad to hear that you are on the mend @BigDave Give it a good blast on the way to Heathrow to keep that DPF filter clear! I’m delighted with the X5. It’s even proving to be a lot cheaper to run than I’d anticipated, which is an added bonus – especially as fuel economy was the last thing on my mind when I ordered it
Pleased to hear you are delighted with your X5 @glos-guy . The fuel economy is a great bonus on top.
Yes, the X6 will be given a ‘spirited’ clean out driving down to Heathrow (and back in December). It should do there and back on a tank full, so I can fill it up with DERV from our farms supply out of bunkerage, so as to avoid the current roadside diesel prices which are not too pleasant. However like yourself, fuel economy is not top of my agenda.
Tried to remove my personal number plates using MB’s website and V5C document reference. Locked my self out on the GOV.UK side. Must admit though GOV.UK answered the phone very quickly, but couldn’t help too much as I am not the owner of the vehicle, so had to use Motability’s online chat – they will be doing it manually. I think it is called “Postal Application”. As I have paid Motability £80 to do it for me, I am not in a rush – may even save me a bob or two for new number plates.
They explained I will receive two forms:
V978 to go and get new number plates – I understood they will be generated on the spot by Halfords according to the car’s age, when I provide them V978? Is it correct?
V778 Retention of my private number plates.Sent from a mobile device.
Apologies for briefness and spelling mistakes.Motability Skoda Enyaq SportLine 85x April 2024 (unhappy customer, but won my case with Ombudsman)
Motability Mazda CX-60 PHEV July 2023 (unhappy customer - early termination on mechanical grounds)
Motability VW Touran Family Pack May 2019 (happy customer)Tried to remove my personal number plates using MB’s website and V5C document reference. Locked my self out on the GOV.UK side. Must admit though GOV.UK answered the phone very quickly, but couldn’t help too much as I am not the owner of the vehicle, so had to use Motability’s online chat – they will be doing it manually. I think it is called “Postal Application”. As I have paid Motability £80 to do it for me, I am not in a rush – may even save me a bob or two for new number plates. They explained I will receive two forms: V978 to go and get new number plates – I understood they will be generated on the spot by Halfords according to the car’s age, when I provide them V978? Is it correct? V778 Retention of my private number plates.
I think it’s a V948. That will have the new registration number on it so, yes, you just take that along to Halfords (or whoever) along with some ID (e.g. driving licence) and they will make the plates up for you. If you take the current plates in with you they will drill the holes in the same places on the new plates.
) finally arrived in the post today. This was the final remaining issue that needed resolving following our transition away from Motability. Free at last! 
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