Trade plates are extremely useful for the motor trade. They save time and money by replacing the need to tax vehicles individually. However, misuse of trade plates can cause problems for yourself and the whole industry. Read on to find out what trade plates are, how they’re misused, and how to display yours correctly.
What are trade plates?
Trade plates are temporary plates, with distinctive red numbers on a white background. They are exclusively for the use of motor trade professionals, mainly when vehicles need to be taken out on the road for delivery, collection, test driving, or inspection.
How can trade plates be misused?
Anyone who wishes to use a vehicle illegally without registering or taxing it might be tempted to abuse trade plates. Examples of misuse are:
- Using trade plates when a vehicle is being driven for personal use, or any business use other than the one stated on the licence.
- Parking on public roads with trade plates displayed, except in an emergency.
- Allowing other people to use trade plates registered with you.
- Using trade plates on multiple vehicles.
- Using trade plates after the licence has elapsed.
- Using trade plates on unsafe, illegal, or uninsured vehicles.
- Faking or defacing trade plates.
There's a big fine and a possible prison sentence attached, so everyone in the motor trade needs to know what counts as misuse. For total clarity, let's take a look at the rules.
The UK rules for using trade plates
- Trade plates can only be used by motor trade businesses. They have to prove they are legitimate by submitting a valid motor trade insurance certificate with each application. The name on the certificate must match the name on the application.
- They can only be used on roadworthy vehicles that either have a valid MOT certificate or are exempt from needing an MOT.
- Plates can only be used for the purpose written on the application form. For example, the application may say that the plates are for customers to test drive vehicles for sale. That means they can't be used for anything else.
- Trade plates can only be used on one vehicle at a time.
- The licence is only valid for a maximum of 12 months. Plates must not be used after the licence has elapsed.
- Vehicles carrying trade plates must be insured. With ChoiceQuote road risk insurance or motor traders’ combined insurance, you can meet legal requirements and ensure that vehicles you have in your temporary possession are insured for trade plate purposes.
- Vehicles with trade plates are never available for personal use of any kind, and must never be left on the road except in an emergency.
- Plates must never be altered in any way.
- If a business with a trade plate licence ceases trading, it must surrender the trade licence.
For a full and detailed list of how trade plates can and cannot be used, check the DVLA’s website. Dos and don'ts are also listed in the guidance notes section of the application form.
How to display trade plates
One form of misuse is failing to display trade plates correctly. Trade plates should be attached to the outside of the vehicle at the front and back, in a vertical position and easily readable from 20 metres away.
Positioning the plates inside the vehicle, so they’re visible through the windscreen or rear window, is not permitted and counts as misuse. Also, they’re not allowed to cover the existing number plates unless the vehicle is a motorcycle.
How to report trade plate misuse
If the general public sees trade plates being misused, it can bring the whole motor trade and its professionalism into disrepute. To report misuse of trade plates, email Trade.Licensing@dvla.gov.uk. Include the nature of misuse and the plate number being abused.
What happens if you misuse trade plates?
In the first instance, a warning letter is sent to the registered holder of that trade plate. Misuse is a legal offence. If the use of trade plates is deemed to be fraudulent, the penalty can be a maximum fine of £5,000 and up to two years in prison. Any misuse can be punished with a fine of up to £1,000.
Protect your motor trade business
As the above information makes clear, you can't apply for a trade plate licence or use the plates correctly without the right insurance. Having it in place can also help to protect the business from liability claims, as well as help to keep your customers, employees, livelihood and personal assets safe.
That's a lot of excellent reasons to contact the ChoiceQuote motor trade insurance team.
FAQs
Can you use trade plates on multiple cars?
No, using trade plates on multiple cars is a fraudulent act and may result in a fine of up to £5,000, or even a prison sentence.
Is there a limit to how many trade plates you can have?
There is no limit to how many trade plates you can have. A motor trade business can have as many sets of trade plates as it can demonstrate a need for. However, each licence costs money, so having more than you need is unnecessary expenditure.
Can you use one trade plate under multiple names?
No. Trade plates can only be used by the business or person named on the licence. If the business changes its name, new trade plates under the new name are required. You’re not allowed to let another person or business use your trade plates.
The sole purpose of this article is to provide guidance on the issues covered. This article is not intended to give legal advice, and, accordingly, it should not be relied upon. It should not be regarded as a comprehensive statement of the law and/or market practice in this area. We make no claims as to the completeness or accuracy of the information contained herein or in the links which were live at the date of publication. You should not act upon (or should refrain from acting upon) information in this publication without first seeking specific legal and/or specialist advice. We do not accept any liability for any inaccuracy, omission or mistake in this publication, nor will we be responsible for any loss which may be suffered as a result of any person relying on the information contained herein.