What is a scrappage deal and how does it work?

Scrappage deals come and go with new car sales initiatives, so what are they?

If you’ve got an older car and want to trade up to something newer, then a scrappage deal can be a great help, but what are they?

As the name suggests, scrappage deals tend to be initiatives run by the government or the broader motor industry to encourage owners of older vehicles to trade in their car for a new model. They help to bridge the price gap of moving from an older, less valuable car to a more expensive new model.

What’s the point of a scrappage scheme?

The reasons for these can be varied but most of the time it is to take older and more polluting cars off the road in favour of newer, safer and more environmentally-friendly vehicles. In previous scrappage schemes, like the one in 2010, buyers of new low-emission cars could avail of a €1,500 reduction in Vehicle Registration Tax (VRT) providing the trade-in met certain criteria. This scheme only applied to new vehicles being sold in emissions Band A and B (up to 140g/km).

How do I know if my car qualifies for scrappage?

Scrappage schemes usually require a car to be of a certain age or to have emissions above a set level. In past schemes the car had to be more than ten years old. To prevent people from using anything vaguely resembling a car to trade in, the vehicle must have been registered in the new buyer’s name for at least 18 months prior to the registration of the new car.

The car being scrapped must also have held a valid NCT no more than 90 days before being traded in. This stipulation is designed to prevent anyone from buying any vehicle whether road-worthy or not to exploit the scrappage discount. If the car does not have a valid NCT but meets the other criteria for a scrappage offer it must be transported — not driven — to the retailer. It is illegal to drive a car on the public roads without a valid NCT certificate and insurance.

Generally, once the old car is traded in it must be professionally disposed of at an authorised treatment facility (ATF) and have a certificate of destruction issued. In most cases the retailer that you trade in your car with will handle this.  This process is to ensure that the car cannot make it back onto the road and it is disposed of in an environmentally responsible way.

Is there a current scrappage scheme?

Presently there is no official scrappage scheme for new cars, but from time-to-time retailers and car brands will offer similarly named schemes to entice buyers. In such cases the scrappage allowance is simply another way of issuing a discount on the car. There is no onus of the retailer to have the trade-in scrapped.

My old car is worth more than the scrappage allowance

The maximum allowance of any scrappage scheme is a set amount and if you think your trade-in is worth more then you may prefer to sell your car privately. But doing so will mean you miss out on the scrappage allowance and will likely mean your older vehicle remains on the road.

Will there be another scrappage scheme?

There are no plans to introduce another scrappage scheme in Ireland. People buying a new electric car can avail of some financial supports through reduction in Vehicle Registration Tax and with a grant from the Sustainable Energy Authority of Ireland (SEAI). However, these measures are only temporary, and they do not apply to every model of electric car.

The government is unlikely to introduce an additional scrappage scheme for older cars.