It has been revealed that drivers could gain back the money paid in fines on their credit cards.

Over the years, motorists have paid millions of pounds in parking fines, but they now could be in line for refunds, after a test case ruled that town hall surcharges imposed for paying by credit cards are unlawful.

An estimated eight million drivers, around one in four of the total number on the roads, receive a parker ticking each year, paying a predicted £1 billion in fines.

Many choose to pay off this fine with a credit card, either by paying online or via a telephone service. At least 12 councils impose a surcharge on this payment method.

However, this practice was challenged by one driver, who criticised the 1.3% surcharge in Camden. As a result, the adjudicator said councils could not demand money in addition to the fine for the offence itself.

Neil Herron of the motorists’ campaign group Parking Appeals, said he was ready to launch a class action to force town halls to reimburse motorists if they fail to do so voluntarily.

He said: "Yet again we have exposed councils acting unlawfully in their pursuit of the motorist. Councils have a duty to act within the law at all times and yet again their greed, by trying to extract every last drop of cash from the motorist, is going to come back and bite them.

"In this instance they can have no excuses. The legislation is explicitly clear. The process of refunding motorists the full amount could not be simpler."

An AA spokesman said: "These credit card charges have been outrageous. Councils have got their fingers burned and have been caught acting illegally. It shows the extent to which councils have been acting as a law unto themselves."