UK car tax, formally Vehicle Excise Duty (VED), falls into three separate systems depending on when your car was first registered: before 1 March 2001, between 1 March 2001 and 31 March 2017, or from 1 April 2017 onward. Which system applies is fixed at registration and never changes, though the rates inside each system are adjusted at each Budget. Fuel type, CO2 emissions, and original list price then decide the exact figure you pay.
Cars Registered Before 1 March 2001
The oldest cars sit outside the emissions system entirely. They pay a flat rate based on engine size, with a single dividing line at 1,549 cc. Anything at or below that capacity pays a reduced rate; anything above pays the standard rate. There are no emission bands, no first-year charge, and no list-price supplement to worry about.
If your car was built before 1 January 1985, it also qualifies for the historic vehicle tax class and pays nothing at all. Where the build date is unknown, cars registered before 8 January 1985 qualify instead.1GOV.UK. Historic (Classic) Vehicles – MOT and Vehicle Tax The threshold rolls forward each year, so 1985-built cars become eligible in 2027. You still have to apply to move the vehicle into the historic class; the exemption is not automatic.
Cars Registered Between 1 March 2001 and 31 March 2017
Cars first registered in this sixteen-year window are taxed under a system of thirteen emission bands labelled A through M.2GOV.UK. Vehicle Tax Rates – Cars Registered Between 1 March 2001 and 31 March 2017 Your car’s band is locked in on the day it was first registered and never changes, no matter how many owners it goes through or how many miles it covers. Only the rate within each band shifts when the government updates the tables.
Band A covers the cleanest cars, those producing up to 100 g/km of CO2. For the 2026/27 tax year, Band A costs £20 annually.3GOV.UK. Rates of Vehicle Tax for Cars, Motorcycles, Light Goods Vehicles and Private Light Goods Vehicles – April 2026 At the other end, Band M catches anything over 255 g/km and costs £790 a year.2GOV.UK. Vehicle Tax Rates – Cars Registered Between 1 March 2001 and 31 March 2017 A thirsty SUV from this era therefore costs roughly forty times more to tax each year than a small hybrid registered on the same day.
To find your band, check the V5C log book for the CO2 figure and match it to the DVLA table. Once you know the band, the rate is the same whether you are the first owner or the fifth.
Cars Registered From 1 April 2017 Onward
In April 2017 the government replaced the lifelong band system with a two-stage structure for newly registered cars. In year one, you pay a first-year rate tied to the car’s CO2 emissions. From year two onward, the car drops to a flat standard rate that ignores emissions entirely.
For the 2026/27 tax year, the standard annual rate is £200 for petrol and diesel cars.3GOV.UK. Rates of Vehicle Tax for Cars, Motorcycles, Light Goods Vehicles and Private Light Goods Vehicles – April 2026 That applies whether your car emits 101 g/km or 250 g/km. This flat rate has climbed over time: it was £140 when the system launched in 2017, rose to £150 from April 2020, £165 from April 2023, and reached £200 from April 2025.
First-Year Rates for New Cars
If you are buying a brand-new car, the first-year charge is set by its WLTP-measured CO2 output. The spread is wide. A zero-emission car pays £10 in year one, while a car emitting over 255 g/km faces £5,690.3GOV.UK. Rates of Vehicle Tax for Cars, Motorcycles, Light Goods Vehicles and Private Light Goods Vehicles – April 2026 A representative sample of the 2026/27 first-year rates for petrol cars and RDE2-compliant diesels:
- 0 g/km: £10
- 1–50 g/km: £115
- 51–75 g/km: £135
- 76–90 g/km: £280
- 151–170 g/km: £1,410
- 191–225 g/km: £3,420
- Over 255 g/km: £5,690
Every one of these cars drops to the £200 standard rate from its second year. The first-year figure is really a one-off pollution levy aimed at showroom decisions.
The Diesel Surcharge
Diesel cars that fail the Real Driving Emissions 2 (RDE2) standard for nitrogen oxides pay a higher first-year rate than a petrol car with identical CO2 output.4GOV.UK. Vehicle Tax Rates – Cars Registered on or After 1 April 2017 A non-RDE2 diesel emitting 51–75 g/km pays £280 in its first year against £135 for the equivalent petrol. The gap narrows at higher emissions and disappears above 255 g/km, where both pay £5,690. From year two, all diesels pay the same £200 standard rate as petrol cars.
The WLTP Change in April 2020
On 1 April 2020 the government switched from the older NEDC lab test to the Worldwide Harmonised Light Vehicle Test Procedure (WLTP) for measuring CO2 on newly registered cars.5GOV.UK. Rules to Measure Carbon Dioxide Emissions for Vehicle Excise Duty WLTP produces higher CO2 readings than NEDC for the same car because it more closely reflects real driving, and the first-year tables were recalibrated so drivers would not pay more purely because of the measurement change.6GOV.UK. Review of WLTP and Vehicle Taxes Two otherwise-identical cars can therefore show different first-year rates depending on whether they were registered before or after that date. Because both move to the same £200 flat rate afterwards, the WLTP distinction only matters at initial registration.
The Expensive Car Supplement
Any car with a list price over £40,000 when new triggers an extra annual charge on top of the standard rate. For electric and zero-emission vehicles first registered from 1 April 2025, the threshold is higher at £50,000.7GOV.UK. Vehicle Tax for Electric, Zero and Low Emission Vehicles List price means the manufacturer’s published price including options, delivery, and VAT, not the figure you negotiated at the dealer.
The supplement runs from year two through year six, so five years in total. For 2026/27 it adds £440, bringing the annual bill to £640 for a qualifying petrol or diesel car.7GOV.UK. Vehicle Tax for Electric, Zero and Low Emission Vehicles If you sell during those five years, the new owner inherits the supplement for whatever remains. After year six, the car falls back to the ordinary standard rate.
Electric and Alternative Fuel Cars
Fully electric cars were exempt from VED entirely until 1 April 2025. From that date onward they pay like any other vehicle.7GOV.UK. Vehicle Tax for Electric, Zero and Low Emission Vehicles What you pay depends, again, on registration date:
- Registered on or after 1 April 2025: £10 first-year rate, then £200 standard rate from year two.
- Registered between 1 April 2017 and 31 March 2025: £200 standard rate.
- Registered between 1 March 2001 and 31 March 2017: £20 per year.
The £10 discount that hybrid and other alternative fuel cars used to receive on the standard rate has also been removed, so hybrids, LPG, and bioethanol cars now pay the full £200.7GOV.UK. Vehicle Tax for Electric, Zero and Low Emission Vehicles Electric cars with a list price above £50,000 are caught by the Expensive Car Supplement from their second year.
Disability Exemptions
Drivers receiving certain disability benefits can claim a full exemption from VED on one vehicle. You qualify if you receive the higher or enhanced rate mobility component of Disability Living Allowance, Personal Independence Payment, Adult Disability Payment, or certain armed forces or war pension mobility supplements.8GOV.UK. Financial Help if You’re Disabled – Vehicles and Transport The vehicle must be registered in your name or your nominated driver’s name and used for your needs.
A 50% reduction is available if you receive the standard rate mobility component of PIP or ADP. The lower rate mobility component of DLA does not qualify for any reduction.8GOV.UK. Financial Help if You’re Disabled – Vehicles and Transport Even where the rate is reduced to zero, you still need to go through the annual tax process so the DVLA knows the car is on the road.
Paying and Getting a Refund When You Sell
You can pay VED annually, every six months, or monthly by direct debit. Paying in full for twelve months is the cheapest route. Monthly direct debit adds 5% to the annual rate, so a £200 standard rate becomes £210 across the year.3GOV.UK. Rates of Vehicle Tax for Cars, Motorcycles, Light Goods Vehicles and Private Light Goods Vehicles – April 2026 A single six-month payment carries a 10% surcharge on the half-year amount.9GOV.UK. Vehicle Excise Duty – Administrative Changes For a high-band pre-2017 car, those surcharges add up quickly: a Band M car paying £790 a year costs roughly £830 across six-month payments.
Tax does not transfer with the car when you sell it. The moment the sale is registered, the existing tax is cancelled and the seller receives an automatic refund for any full months remaining.10GOV.UK. Cancel Your Vehicle Tax and Get a Refund The buyer has to tax the car before driving it, using the new keeper section of the V5C. Partial months are not refunded, and the direct debit or six-month surcharges you paid are not refunded either. On a brand-new car sold within its first year, the refund is based on whichever is lower: the first-year rate you paid or the standard rate.