Drivers are being hit with higher road tax bills after new rules and rates took effect on April 1
British motorists may be considering selling their cars following an increase in road tax. From April 1, the DVLA increased the amount of tax due by millions of drivers, including raising the standard rate and scrapping the tax exemption for electric vehicles (EVs).
There have also been tax rises for low-emission vehicles, while the first-year rates for higher polluting new cars has doubled. According to The AA, the new tax rates could lead to the average UK car paying more than £650 every year in fuel duty and road tax.
The new standard annual road tax rate has increased from £190 to £195 and applies to all cars – including EVs – first registered between April 1, 2017, and March 31, 2025. New EVs registered from April 1, 2025, will be taxed £10 in the first year – known as the ‘showroom tax’ – while those with a list price exceeding £40,000 will also be hit with the ‘expensive car supplement’.
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These high value cars are now liable to pay an additional £425 per year between the second and sixth years of ownership. However, all EVs registered before March 31, 2017, will pay a lower annual rate of £20.
The new rules also affect low-emission vehicles, with those producing between one and 50 g/km of CO2 now liable for a £110 tax rate. Until the changes, hybrid cars in this band – which includes most plug-in hybrids – paid no road tax in the first year, whilst petrol and diesel cars in the same band paid £10.
First-year road tax for new cars emitting 51-75 g/km has risen to £135, up from the previous rate of £20 for hybrids and £30 for petrol and diesel cars. The rate for higher-polluting new cars producing 76g/km or more has now doubled.
This means new cars in the highest band of 255g/km or more will pay £5,490 in the first year. This applies to 59 new models from 24 car manufacturers, such as Bentley’s Continental W12, Porsche’s 911 Turbo and Land Rover’s Defender V8.
If your car was first registered from March 1, 2001, you can also use Webuyanycar’s CO2 emissions checker to find its emissions level to work out how much car tax will be due. Richard Evans, Webuyanycar’s head of technical services, said the changes to road tax mark a ‘pivotal shift’ for drivers.
He said: “The most recent DVLA tax changes mark a pivotal shift for British motorists, particularly for EV owners, who are now facing road tax for the first time. Whilst these changes may well cause British drivers to reconsider their vehicle choices, it is difficult to predict exactly how it will impact people’s decision to sell their current vehicles as despite the changes and increases across the board, EV drivers still have the most favourable road tax rates.
“One thing we do know is that since these changes took effect on April 1, owners of EVs first registered before April 2017 now have the cheapest annual road tax rate of all at £20. This makes older EVs an attractive option for budget used car buyers looking to save on running costs.
“Meanwhile, road tax rates for cars producing over 76 g/km of CO2 have doubled, so, if you buy a new luxury or performance car in the highest emissions band, you’ll now face a £5,490 first-year road tax bill. Therefore, if ownership costs are a concern, it pays to opt for a greener motor.”
Full list of tax changes from April 1
New standard road tax rate
The annual standard rate for road tax has risen from £190 to £195, applying to all vehicles first registered after April 1, 2017, and before March 31, 2025.
New taxes for EVs
The road tax exemption for all EVs has ended. New EVs registered from April 1 are now taxed £10 in the first year – known as the ‘showroom tax’.
EVs registered between April 1, 2017, and March 31, 2025, are now required to pay the new standard rate road tax of £195 per year. EVs registered before March 31, 2017, benefit from a lower annual rate of £20.
A £10 reduction on the standard rate road tax for alternative fuel vehicles – including hybrid, bioethanol and liquefied petroleum gas (LPG) cars – has also ended. Affected drivers are now liable for the new standard £195 annual rate.
Electric vans are taxed at an annual rate of £355 – the same applied to petrol and diesel light goods vehicles. Any EVs registered with a list price exceeding £40,000 are also subject to an extra £425 per year between the second and sixth years of ownership – known as the ‘expensive car supplement’.
Tax increases for low-emission vehicles
First-year road tax for low-emission vehicles producing between 1 and 50g/km of CO2 is now £110. Before the changes, hybrid cars in this band – including most plug-in hybrids – paid no road tax in their first year, while petrol and diesel cars in the same band paid £10.
First-year road tax for new cars emitting 51-75g/km is now £135. The previous was £20 for hybrids and £30 for petrol and diesel.
Doubling first-year rates for higher-polluting new cars
The first-year rate for cars in all other road tax bands – those producing 76g/km or more – has doubled. New cars in the highest band – producing 255g/km or more – are now subject to £5,490 tax in their first year.
The top rate will affect 59 new models from 24 car manufacturers, including the Bentley Continental W12, Porsche 911 Turbo and Land Rover Defender V8.
Car tax exemptions
SORN cars
Drivers who make a SORN (Statutory Off-road Notification) for their vehicle will be exempt from paying road tax for that particular vehicle. They will also be eligible for a road tax refund from the DVLA if they have any full months’ tax remaining.
Historic cars
Cars more than 40 years old usually qualify for road tax exemption, but this is not automatic. Drivers must apply once their car meets the eligibility criteria.
Drivers with disabilities
Drivers can apply for exemption from road tax if in receipt of:
- The higher rate mobility component of Disability Living Allowance
- The higher rate mobility component of Child Disability Payment
- The enhanced rate mobility component of Personal Independence Payment (PIP)
- The enhanced rate mobility component of Adult Disability Payment (ADP)
- Armed Forces Independence Payment
- War Pensioners’ Mobility Supplement
- Drivers can also apply for a 50% vehicle tax reduction if they receive the standard rate mobility component of PIP or the enhanced rate mobility component of ADP. For more information, visit Gov.uk’s ‘Financial help if you’re disabled’ section here.
