What Happens to Your Car When You Die?

The transfer of car ownership after death is a common concern. This article provides a concise overview of the process involved in handling a deceased individual's vehicle.

Ownership Transfer

1. Owned Outright: If you own the car outright, the vehicle will pass to the person named in your will or, in the absence of a will, according to the laws of intestacy. The new owner must notify the DVLA and provide the ‘new keeper’ slip and a letter explaining the transfer due to death.
2. Outstanding Finance: If there's outstanding finance on the car, the inheritor must contact both the DVLA and the finance company. They can choose to continue the payments and keep the car or return it to the finance company. If the car’s sale doesn't cover the remaining finance, the shortfall is taken from your estate.

Insurance and Road Tax

The new owner must arrange their own insurance policy as the existing one doesn't transfer automatically. They also need to handle road tax or register the car as SORN (Statutory Off Road Notification) if it won't be used.

Jointly Owned Vehicles

For jointly owned vehicles, the process varies. In joint ownership with 'right of survivorship', the surviving owner automatically becomes the sole owner. In 'tenants in common' arrangements, the deceased’s share is handled according to their will or intestacy rules.

See UK rules on Intestacy

Legal and Financial Considerations

It's advisable for inheritors to seek legal or financial advice, especially in cases of high-value or classic cars, or if the estate is complex. Additionally, the car’s value and associated debts can impact the overall value of the estate and inheritance tax liabilities.

In summary, the transfer of a car after the owner's death involves notifying authorities, addressing finance and insurance matters, and understanding joint ownership nuances. Legal and financial advice is recommended for smooth handling of these aspects.