Page last updated at 15:39 GMT, Monday, 28 September 2009 16:39 UK

Q&A: The new car scrappage scheme

Scrapped cars
The government wants people to scrap their old cars and buy new ones

The government has announced that its car scrappage scheme is being extended by £100m or a further 100,000 vehicles.

It will also lengthen the cut off point for the old cars being traded in by six months.

Meanwhile, van owners will be able to trade in their old commercial vehicle if it is more than eight years old, rather than the previous 10.

The government says the changes will come into effect as soon as possible, once formal agreement has been reached with the vehicle manufacturers.

Here are the details.

What age does the old car have to be?

The car being traded in has to be approximately 10 years old or older.

The old car had to be registered on or before 29 February 2000. This is an extension to the previous deadline which said the old car had to be registered by 31 August 1999.

How much money can I get towards a new car?

This remains the same as previously - £2,000 - with half coming from the government, and half from the participating car firm you are buying the new vehicle from.

The dealer will sort out all the paperwork, and the £2,000 will come straight off the price of the car.

Can I buy a demonstration car?

The car you buy must be brand new and you must be the first registered keeper.

So if the garage has already registered it you cannot buy it under the scrappage scheme.

The car must not be a grey import and must have a UK specification.

Can I swap my son or daughter's old banger for a new car for me?

Not normally. The person buying the new car also has to be the registered keeper of the new vehicle.

So either you have to be the owner of your teenager's car or you have to give them the money to buy the new car.

Can I buy an old banger and then use it to get £2,000 towards a new vehicle?

No. You must have owned the old vehicle for 12 whole calendar months before the new car is ordered.

Is the £2,000 on top of any other discount or the trade-in value of the old car?

No. The rule is that the garage must offer you at least a £2,000 discount.

It is up to the dealer to offer you more than that, but the rest will not be subsidised.

As new car sales remain subdued, it is worth negotiating for a further discount.

Can the garage sell my old vehicle back to me?

No. The old vehicle cannot be sold to anyone. It has to be scrapped by the dealer and a Certificate of Destruction issued, which the government will be checking.

Does it cover motorbikes?

No. The scheme covers cars and light vans up to 3.5 tonnes. You can swap car for car, van for van, or van for car or vice versa.

How has the scheme changed for van owners?

Van owners will be able to trade in a vehicle that is more than eight years old, rather than the previous 10 when the scrappage scheme was first launched in May.

I live abroad. Can I bring my car to the UK to take part in the scheme?

No. The car has to be registered in the UK and the registered keeper has to have a UK address.

Can I swap two old cars and get £4,000 off?

No. You can use two qualifying old cars to buy two new cars. But you cannot use more than one old car for one new car.

Will my old vehicle qualify if it is off the road?

Any vehicle must be legal to qualify. So if it is off the road with a valid Statutory Off Road Notification (SORN) document, then it will only qualify if you first get it taxed and insured and gain a valid MOT.

Do I have to buy a new vehicle which has low emissions?

No. You can buy any new car as long as the manufacturer is participating in the scheme.

How successful has the scheme been so far?

To date, 227,750 old cars have been traded in for new ones, from the initial budget of £300m.

The scheme has now been extended until the end of February next year, or when the new budget of £400m runs out - whichever is sooner.

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