Premium rate car tax is the everyday name for the UK’s expensive car supplement: an extra £440 added to your annual Vehicle Excise Duty when your car’s list price at first registration was above £40,000 for petrol, diesel, and alternative-fuel cars, or above £50,000 for zero-emission cars registered from 1 April 2025 onward. It applies for five years, starting from the second time you tax the vehicle, and it only affects cars first registered on or after 1 April 2017.1GOV.UK. Vehicle Tax for Electric, Zero and Low Emission Vehicles
Which Cars Have to Pay It
Three things need to be true. The car was first registered on or after 1 April 2017. Its list price on that day was above the threshold that applies to it. And it sits in the M1 type-approval class, which covers standard passenger cars.2GOV.UK. Administrative Amendment to Vehicle Excise Duty Expensive Car Supplement
The thresholds are £40,000 for petrol, diesel, and alternative-fuel cars, and £50,000 for zero-emission cars registered from 1 April 2025.1GOV.UK. Vehicle Tax for Electric, Zero and Low Emission Vehicles Cars registered before April 2017 fall under older VED rules and are not affected, whatever they originally cost. Vans and motorcycles are outside the supplement entirely. Motorhomes in the M1SP category registered between 1 April 2017 and 11 March 2020 can be caught, but only if CO2 emissions appear on their type-approval certificate.3GOV.UK. Vehicle Tax Rates: Motorhomes
What Counts as the List Price
The list price is not what you paid. It is the manufacturer’s published price on the day before first registration, before any dealer discount.4GOV.UK. Vehicle Tax Rates: Cars Registered on or After 1 April 2017 Knock £3,000 off a £42,000 car and you still owe the supplement, even though the money that changed hands was under £40,000.
The list price includes VAT, any options fitted by the manufacturer, the manufacturer’s delivery charge, and pre-delivery inspection. It does not include the first registration fee or the first year of VED.5GOV.UK. Changes to Vehicle Tax From April 2017 – Webinar Q and A Advertised on-the-road prices bundle those extras in and will therefore look higher than the figure that matters for the supplement.
Accessories the dealer bolts on after manufacture — floor mats, a dash cam, a paint protection pack — do not count. Only factory options do. That is where the supplement most often catches buyers unaware: a car with a base price of £38,000 can cross £40,000 as soon as you tick metallic paint, an upgraded wheel option, and a tech pack in the configurator. If you are near the line, check the manufacturer’s own price list, not the dealer’s total.
How Much It Costs
From April 2026, the standard annual VED for petrol, diesel, and alternative-fuel cars registered on or after 1 April 2017 is £200. If your car is caught by the supplement, you pay an additional £440 on top, for a total of £640 a year. Paying by monthly direct debit pushes the annual figure to £672 because of the surcharge on instalments.6Driver and Vehicle Licensing Agency. Rates of Vehicle Tax for Cars, Motorcycles, Light Goods Vehicles and Private Light Goods Vehicles April 2026
Across the five supplement years, that is £2,200 more than an otherwise identical car sitting under the threshold. The full five-year VED bill for a supplement car works out to £3,200, or £3,360 by monthly direct debit, before you count the separate first-year rate. For any car specced near £40,000, that long-term cost is worth putting into the buying decision.
When It Starts and When It Ends
The supplement does not apply to the first licence you buy for a new car. That first year is calculated on the vehicle’s CO2 emissions and varies widely. The supplement kicks in at the second renewal and runs for five consecutive years, so it covers years two through six of the car’s life. From year seven, the car drops back to the standard rate for its class.6Driver and Vehicle Licensing Agency. Rates of Vehicle Tax for Cars, Motorcycles, Light Goods Vehicles and Private Light Goods Vehicles April 2026
The liability travels with the car. Buy a three-year-old used car that originally listed above the threshold and the remaining supplement years come with it. A car first registered in 2023 still carries the surcharge until 2029, whoever owns it in between.
Refunds If You Sell, Scrap, or SORN
If you sell the car, scrap it, or make a Statutory Off-Road Notification, you can claim a pro-rata refund for the unused months on your current licence, and that refund includes the supplement portion. A 2021 amendment to the Vehicle Excise and Registration Act 1994 makes sure the calculation still works in the final supplement year, splitting the remaining months between the higher rate and the standard rate if the six-year window closes partway through your licence.2GOV.UK. Administrative Amendment to Vehicle Excise Duty Expensive Car Supplement
Electric and Hydrogen Cars
Zero-emission cars were completely exempt from VED and from the supplement until 1 April 2025. That exemption ended, and electric and hydrogen fuel-cell cars now pay vehicle tax on the same footing as other vehicles, with one concession: the supplement threshold is set at £50,000 rather than £40,000.1GOV.UK. Vehicle Tax for Electric, Zero and Low Emission Vehicles The £440 amount is the same. A good number of mainstream EVs list under £50,000, so the higher ceiling spares many buyers, but a well-specced premium model can easily go over it.
Exemptions
Disabled Tax Class
Vehicles in the disabled tax class can be fully exempt from VED, supplement included. Qualifying benefits are the enhanced rate mobility component of Personal Independence Payment, Disability Living Allowance, Adult Disability Payment, or Armed Forces Independence Payment.7GOV.UK. How to Apply for Free Disabled Tax The car must be registered to the disabled person or a nominated driver and used only for the disabled person’s needs.8GOV.UK. Financial Help if You’re Disabled: Vehicles and Transport The standard rate mobility component of PIP gives a 50% reduction instead, applied to the supplement as well as the base rate.
Historic Vehicles
Cars over 40 years old can be moved into the historic vehicle tax class at a £0 rate. From 1 April 2026, vehicles built before 1 January 1986 qualify, and you apply at a Post Office that handles vehicle tax, using your V5C.9GOV.UK. Historic (Classic) Vehicles: MOT and Vehicle Tax: Eligibility In practice this rarely overlaps with the supplement, because the supplement only touches cars registered from April 2017.
Checking a Used Car Before You Buy
Use the DVLA’s free vehicle enquiry service to look up the first registration date, current tax rate, CO2 emissions, and type-approval category from the number plate.10GOV.UK. Get Vehicle Information From DVLA The current tax figure will already reflect the supplement if it is still running. What the service does not show is the original list price, so if the car was optioned near the threshold you will need the manufacturer’s price list for that model year, or a specification sheet from the dealer showing factory options and their prices with VAT.
Count six years forward from first registration. If that date is still in the future, the supplement is still active and the seller is under no obligation to mention it. The check is on you.