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A dealer is retaining the V5C of my ex-demo car - is this right?

I purchased a car from a main dealer who has retained the V5C for two months because it is a demo car. The dealer is also paying the tax during this period. I have read on another motoring website that unless I am paying the tax, my insurance is invalid. The dealer is adamant that this is all above board and legal, but I'm no longer convinced since I read about my insurance being invalidated. Are there any implications of the tax not being in my name?

The only document I have is an invoice from the main dealer saying I have purchased the car first month tax paid. When I collected the car, the dealer said "good news, we've actually taxed it for three months, we'll send you the V5C then".

Asked on 2 August 2018 by Mark

Answered by Honest John
You are effectively leasing the car for this two month period and that needs to be document for your insurance to be valid. As long as the dealer is the registered keeper, all NIPs and penalties will be notified to him, not to you.
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