Vehicles that have reached the end of their usefulness must be scrapped at an authorised treatment facility (ATF). This is usually free.
If your vehicle has been damaged and written-off by your insurance company, they usually dispose of it for you.
If you’re taking parts to repair or restore another vehicle, you have to make a SORN (Statutory Off Road Declaration) or keep taxing it until you take it to an ATF.
ATFs are allowed to charge for handling and disposing of vehicles that are missing essential parts, eg the engine, gearbox, bodywork or wheels.