Trade plates

What trade plates are

GOV.UK: “Trade licence plates are number plates you can use on vehicles your business has for things like selling, repairing or testing.” With them displayed, “your employees and customers can drive the vehicle for certain purposes without having to pay to register and tax it” — for example, customers test driving cars for sale. (GOV.UK)

In the law, a motor trader's trade licence is a licence for “all vehicles which are from time to time temporarily in his possession in the course of his business as a motor trader”. (Vehicle Excise and Registration Act 1994, s11(3))

Who can get them

GOV.UK says motor dealers, motor traders and vehicle testers can apply — a business that:

• sells vehicles;
• manufactures or repairs vehicles;
• tests other people's vehicles on public roads.

A business that collects or delivers vehicles is also eligible if that is the only thing it does, or if it also manufactures or repairs vehicles. (GOV.UK) The Act also lets DVLA issue a licence to someone who satisfies it that they intend to start in business as a motor trader or vehicle tester. (s11(1))

How to apply

• Fill in form VTL301. DVLA: it is “a print only form and cannot be completed digitally”, and must be posted, not sent electronically. (DVLA)
• Send a copy of your Motor Trade Insurance Certificate with it. “If you have a different type of insurance, your application will not be approved.” The name on the certificate must match the name on the form. DVLA can't return copies, so originals aren't sent.
• Without a Motor Trade Insurance Certificate, the form has to say why and give the Companies House registration number.
• Choose the plates: a vehicle set plus a motorcycle, bicycle or tricycle set; just vehicles; or just motorcycles, bicycles or tricycles. Each extra set needs an extra licence, applied for the same way.
• If approved, the confirmation letter and the plates are sent separately, “within 4 weeks of applying”.

Source: GOV.UK, Apply for a trade licence

What a licence costs

Every trade licence ends on 30 June or 31 December, and lasts no less than 6 and no more than 12 months. So the first licence is priced by the month you apply; renewals are for 6 or 12 months. GOV.UK's rates on 23 October 2026:

Source: GOV.UK, Apply for a trade licence (“Rate of duty” columns as GOV.UK labels them)

What the plates can be used for

The plates can only be used for the purpose written on the application form — GOV.UK's example: plates applied for so customers can test drive vehicles for sale “cannot be used for other purposes”. (GOV.UK) The law sets the outer limits. For a motor trader, a journey on trade plates has to be for business purposes — connected with the business as a manufacturer, repairer or dealer in vehicles (or trailers), modifying vehicles, or valeting vehicles — and one of these:

• testing the vehicle or its accessories or equipment, during or after construction, modification or repair;
• going to or from a public weighbridge, or to or from a place for its registration or an inspection on behalf of the Secretary of State;
• a test or trial for a prospective buyer, going to the place of that test at the buyer's request, and returning;
• a test or trial for someone promoting publicity about the vehicle, and going to and returning from it;
• delivering it to the place where the buyer intends to keep it;
• demonstrating how it or its equipment works when handing it over to the buyer;
• moving it between parts of the licence holder's premises, to or between another dealer's or repairer's premises, or from another dealer's premises direct to the holder's own;
• going to or from a workshop where a body, equipment or an accessory is fitted, or where it is painted, valeted or repaired;
• going from a dealer's premises to a place it will be carried by train, ship or aircraft, or back;
• going to or from a garage, auction room or other place where vehicles are usually stored or offered for sale, where it is to be or has been stored or offered for sale;
• going to or from a place where it is to be or has been inspected or tested;
• going to a place where it is to be broken up or dismantled.

Source: Road Vehicles (Registration and Licensing) Regulations 2002, Schedule 6, paragraphs 10–12 (in plain words; the full wording is at the link)

Also in the law:

• One licence covers one vehicle at a time: a holder isn't entitled “to use more than one vehicle at any one time”. (Act, s12)
• No goods, except loads the law allows: a test load returned to where it was loaded, a load built into or fixed to the vehicle, another vehicle used to travel to or from a delivery or collection, and (for some journeys) a trailer or parts to be fitted to the vehicle with the tools to fit them. (Schedule 6, paragraph 13)
• Passengers only when carried in connection with those purposes. (Schedule 6, paragraph 9)

Insurance, tax and MOT

• Tax: with trade plates on, the vehicle can be driven for those purposes “without having to pay to register and tax it”. (GOV.UK)
• Insurance: not included. Applying needs motor trade insurance, and the plates can only be used on vehicles that are insured.
• Roadworthiness and MOT: the plates can only be used on vehicles that are safe to drive (“roadworthy”) and have a valid MOT, or are exempt from needing one.

Sources: GOV.UK, Apply for a trade licence and Rules for using your trade plates

Displaying them

From GOV.UK, trade plates go:

• on both the front and back of the vehicle (just the back for motorcycles);
• where they are visible and easily readable from 20 metres;
• on the outside of the vehicle;
• without covering the existing number plates, unless it's a motorcycle.

Source: GOV.UK, Rules for using your trade plates

The licence conditions also say the plates must not be altered, defaced or added to, and plates whose figures are illegible or whose colour has changed — “whether by fading or otherwise” — must not be shown. Only plates showing the registration mark DVLA gave that licence holder may be used. (Schedule 6, paragraphs 2, 3 and 7)

Who else may use them

GOV.UK says the plates let the business's employees and customers drive the vehicle for the licensed purposes. (GOV.UK) The licence conditions add that the holder “shall not permit any person to display” its trade plates on a vehicle “except a vehicle which that person is using for the purposes of the holder under the licence”. (Schedule 6, paragraph 5)

Penalties

It is an offence for a trade licence holder to use more vehicles at once than the licences allow, or to use a vehicle for a purpose the regulations don't list. The penalty is an excise penalty of level 3 on the standard scale or five times the vehicle excise duty on the vehicle concerned, whichever is greater. (Act, s34)

Lost plates, renewals and changes

• Lost or stolen: report it to the police, then apply on form VTL310 (with the crime reference number if stolen). Replacement sets cost £18 (vehicle and motorcycle sets), £13.50 (vehicle set) or £7 (motorcycle, bicycle and tricycle set). A damaged vehicle plate is replaced only as a full set, and the whole set goes back to DVLA first. Plates unreadable through fading rather than accidental damage may be replaced free.
• Renewing: DVLA sends a letter before the licence runs out; without one, form VTL318. The same motor trade insurance certificate rules apply.
• New address: form VTL310, and the existing plates stay in use. New business name: a new licence on form VTL301, returning the plates, with form VTL308 for a refund of the old licence's remaining months.
• Ending the licence early: return the plates with form VTL308 — the refund is for each full calendar month left.

Source: GOV.UK, Trade licence plates (whole guide)

More on starting out as a trader in Car flipping in the UK, and on VAT in The VAT margin scheme for used cars.