The incentive will be split, with £1,000 provided by the government and the remaining £1,000 from the vehicle manufacturer.
To qualify for the scheme, announced by the Chancellor in his Budget speech, the vehicle being scrapped must have been registered on or before 31 July 1999 and come complete with valid tax, insurance and MOT documents (or be registered as SORN). The driver applying to scrap the vehicle must also have been its owner for at least a year.
The new vehicle being purchased must be first registered in the UK on or after the date the scrappage scheme is launched, and declared new at first registration. It must also be built to UK specifications and registered to the same person as the scrapped vehicle.
The supplying dealer will do all the paperwork, arrange for the old van to be scrapped, and check that the part-exchange and the new vehicle both meet the scheme's terms and conditions.
AA President Edmund King has welcomed the scheme, saying: "Van mileage has grown much faster than car traffic over the last three years. So there is a good case for replacing some of the dirtier vans with cleaner models. White Van Man is essential for the economy and is struggling in the current recession. A grant to bring newer shinier white vans onto the fleet would also help the environment, economy and employment."
"We are pleased the scheme has been kept relatively simple without any CO2 restrictions on the type of vehicle to be purchased. If every ten year-old vehicle were replaced with today's equivalent we would see a 30% increase in fuel efficiency and almost 30% decrease in CO2 emissions."