A substantial rise in vehicle excise duty, often known as car tax, will be imposed on drivers because of DVLA regulations coming in on Tuesday.
Drivers will be affected by several changes, such as a revised standard road tax rate, new electric vehicle (EV) taxes, higher fees for low-emissions vehicles and a significant hike in first-year rates for those buying new vehicles with very high CO2 emissions.
Here is a breakdown of everything you need to know.
Car tax changes from April 1
For vehicles registered between April 1, 2017 and March 31, 2025 the standard yearly road tax will rise from £190 to £195.
Electric vehicles
The road tax exemption for EVs will end. There will be a £10 first-year tax (often referred to as the showroom tax) for new EVs registered after April 1.
A “expensive car supplement” is also required for any EV that costs more than £40,000, which adds £425 a year between the second and sixth years of ownership.
The normal rate road tax, £195 a year from April 1, will become due on EVs registered between April 1, 2017 and March 31, 2025.
Those who registered their EVs before April 2017 will benefit from a reduced annual charge of just £20.
Additionally, starting on April 1, alternative fuel vehicles – such as hybrids, bioethanol and liquefied petroleum gas cars – will no longer receive the £10 first-year rate and will go on to the £195 rate.
Electric vans are also not exempt from the adjustments. They will attract an annual tax rate of £355, the same as that of petrol and diesel light goods vehicles.
Higher polluting new cars
For vehicles in all other road tax classes (emitting 76g/km or higher), the first-year charge will treble. This means a substantial £5,490 tax will be imposed on new cars in the highest band (those producing 255g/km or more) during the first year of ownership.
This top rate will affect cars such as the Land Rover Defender V8, the Porsche 911 Turbo and the Bentley Continental W12.
Low-emissions vehicles
For low-emissions vehicles with CO2 emissions between one and 50 g/km, the first-year road tax will rise to £110. Before this change, plug-in hybrid vehicles in this class were exempt from road tax for the first year, while owners of their petrol and diesel counterparts paid £10.
For new cars with emissions between 51 and 75 g/km, the first-year road tax will increase to £135. Previously, cars in this category cost £20 for hybrids and £30 for petrol and diesel vehicles.
What it means for you
Determining your road tax responsibilities can be greatly aided by understanding the UK's vehicle tax band system.
The first-year showroom tax for new car buyers will be determined by the vehicle's CO2 emissions.
For any diesel vehicles registered from April 1, 2025, it will be moved up one showroom tax band if it doesn't comply with Real Driving Emissions Step 2 (RDE2) regulations.
For cars registered from April 1, 2017, you will have to pay a normal annual road tax starting in the second year of ownership, which will go up to £195.
Cars registered between March 1, 2001 and March 31, 2017 are taxed using 13 emissions-based bands, ranging from A to M. And any cars registered before March 1, 2001 are taxed based on engine size, not emissions.
Electric vehicles
Electric cars (EVs) and other vehicles with a list price over £40,000 will be subject to an annual surcharge of £425 (for years two to six), which is an increase from the £410 rate for 2024–2025. This will only be relevant to newly registered EVs as of April 1, 2025.
Are any drivers exempt from vehicle excise duty?
You may qualify for a vehicle tax exemption if you are a driver with a disability. If you receive the enhanced rate mobility component of armed forces independence payment (AFIP) or the standard rate mobility component of personal independence payment (PIP), you may additionally qualify for a 50 per cent vehicle tax reduction.
You may also be eligible for a vehicle excise duty exemption if your vehicle is older than 40 years old and you will not be obliged to pay road tax on your car if you declare a Statutory Off-Road Notification (SORN).
