Road Tax Changes
Everything You Need to Know About the 2025 Vehicle Excise Duty (aka Road Tax) Changes
Car tax is a fee that drivers must pay to the government in order to register and drive their cars on the road. The amount you pay depends on the type of vehicle, its value, and other factors.
On April 1st 2025, Vehicle Excise Duty (also known as car or road tax or road tax) will be changing and for the first time Electric Vehicles will be subject to VED.
Here’s what you need to know about the latest changes to road tax:
The UK government recently announced changes to road tax that will come into effect in 2025. If you're wondering what this means for you as a driver, don't worry - we've got you covered!
The latest changes will affect all drivers in the UK, so it's crucial to stay informed on what's happening. From 1st April 2025, Electric Vehicle owners will now need to pay VED and the premium car tax fund is also changing.
How much will my car tax be in 2025?
If you're wondering about how much car tax you'll be paying in 2024, there are a few factors to consider. Firstly, the amount you pay depends on the type of car you have and its CO2 emissions. The lower the emissions, the lower the tax. Additionally, the government updates the rates for car tax each year, we’ll be going through what those updates should look like for this year.
The best way to beat the VED increase is to buy a new car before 1st April 2025!
How is VED calculated?
Road tax is calculated based on the car's engine size, fuel type and CO2 emissions.
The amount of road tax you need to pay is determined by the amount of CO2 your car emits. Generally, the higher the CO2 emissions, the more road tax you will need to pay.
Is VED increasing?
As part of the Autumn Budget, the Chancellor of the Exchequer confirmed Vehicle Excise duty (VED) would increase in line with inflation meaning millions of road users will see their road tax rates increase.
The first-year road tax has also been adjusted and now incurs a small charge for Battery Electric Vehicles for the first time ever. A new car's tax cost can range from £10 to £5,490 in the first year depending on its CO2 emissions. For most car buyers that means road tax now ranges from £350 to £1,360.
All cars then move to a flat annual rate for the second year onwards.
What will the second year plus VED rate be?
For vehicles registered on or after 1st April 2025, all vehicles will be subject to a VED payment from the second year of registration onwards.
The Standard Rate applies to all vehicles, including Battery Electric Vehicles, under £40,000 and rises to £195 from £190.
The Premium Car Tax Rate for all vehicles, including BEVs, where the list price is over £40,000 and is rising from £410 to £425.
How much will my car tax be?
The below rates are for the 2025-2026 tax year
Emissions (g/CO2/km) | First year rate | Standard rate* |
0 | £10 | £195 |
1-50 | £110 | £195 |
51-75 | £130 | £195 |
76-90 | £270 | £195 |
91-100 | £350 | £195 |
101-110 | £390 | £195 |
111-130 | £440 | £195 |
131-150 | £540 | £195 |
151-170 | £1,360 | £195 |
171-190 | £2,190 | £195 |
191-225 | £3,300 | £195 |
226-255 | £4,680 | £195 |
over 255 | £5,490 | £195 |
*cars over £40,000 pay £425 supplement for 5 years
Cars registered between 2001 and 2017
The tax system used to work by charging the tax based off their CO2s and you paid the same rate every year.
Road Tax for cars registered between 1 March 2001 and 31 March 2017
The below rates are for the 2025-2026 tax year
VED Band | CO2 Emissions (g/km) | Standard Rate |
A | Up to 100 | £0 |
B | 101 -110 | £20 |
C | 111 - 120 | £35 |
D | 121- 130 | £160 |
E | 131- 140 | £190 |
F | 141 - 150 | £210 |
G | 151 - 165 | £255 |
H | 166 - 175 | £305 |
I | 176- 185 | £335 |
J | 186 - 200 | £385 |
K* | 201- 225 | £415 |
L | 226 - 255 | £710 |
M | Over 255 | £735 |
* This includes cars emitting over 225g/km registered before 23 March 2006.
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