Section 135B of the Finance Act 1992 is amended by inserting the following after subsection (5):

"(6)

(a) Subject to sections 105B, 105C and 105D of the Finance Act 2001 where an authorised person pays an amount of vehicle registration tax in respect of a vehicle which was not due, any repayment of the overpaid amount and interest (if any) payable under section 105D shall, subject to the provisions of this subsection, be made to the authorised person on condition that the authorised person pays the amount of the repayment and interest to the person who was the registered owner of the vehicle at the time of the registration of the vehicle.

(b)

(i) Where the registered owner of the vehicle at the date of the repayment to the authorised person is the first registered owner the amount of the repayment shall be the amount of the vehicle registration tax overpaid.

(ii) Where the first registered owner has disposed of the vehicle prior to the date of the repayment the amount of the repayment shall be calculated as follows:

(OP + V) - (S × R)

where -

OP is the original purchase price,

V is the amount of vehicle registration tax paid,

S is the price, if any, received by the first registered owner at the time of disposal, and

R is the rate of vehicle registration tax charged at the time of registration on purchase.