Car Tax Changes 2025 – Complete Guide to New VED Rates
The 2025 Vehicle Excise Duty (VED) reforms mark the most significant shift in UK car taxation in years. From April 2025, electric vehicles lose their zero-rate exemption, while petrol and diesel cars face higher first-year charges based on CO₂ emissions. This guide explains the new rates, who is affected, and what remains uncertain.
For the first time, owners of zero-emission cars will pay road tax. New EVs registered from 1 April 2025 incur a £10 first-year fee, followed by the standard annual rate. Existing EV owners are also affected once the rules take effect. At the same time, the standard VED rate for most cars rises to £195, and the first-year bands for petrol and diesel vehicles have been tightened to penalise higher emissions.
These changes are part of a broader government strategy to replace declining fuel duty revenue as the electric vehicle fleet grows. The adjustments apply across all fuel types and registration periods, making it essential for every driver to understand their new tax band. Official GOV.UK vehicle tax rate tables provide the definitive figures.
What are the car tax changes coming in 2025?
Core Change
Standard rate rises to £195 per year. EV free road tax ends.
Affected Groups
New car buyers face higher first-year rates. EV owners pay £10 first year, then £200. Existing owners see the standard rate apply.
Key Dates
1 April 2025: first-year and standard rate changes take effect. 1 April 2026: further adjustments expected.
Quick Cost Check
Use the official GOV.UK vehicle tax rate lookup or check your V5C registration date to confirm your band.
Key insights at a glance
- The free road tax era for EVs ends in April 2025, with a £10 first-year charge and subsequent standard rate of £200.
- First-year VED rates for new petrol and diesel cars increase significantly, tied to CO₂ emissions bands.
- Cars registered before April 2025 retain their current VED band but will see the standard rate rise to £195.
- The 2026 rates are not yet fully confirmed; official figures will be published in the 2026 Budget.
- Owners of older cars (post‑2017) are not exempt from the £195 standard rate unless they qualify for a disability exemption.
Snapshot of key VED rates
| Category | Rate (April 2025 – March 2026) | Rate (April 2026 – TBC) |
|---|---|---|
| Standard Rate (all cars) | £195 | TBC (likely increase) |
| EV first year | £10 | TBC |
| EV subsequent years | £200 | TBC |
| Petrol/Diesel first year (band A – M) | £0 – £2,745 | TBC |
How do the 2025 VED changes affect cars registered before April 2025?
If your car was registered before 1 April 2025, the way the changes hit you depends on its age and fuel type. The most important point is that existing EVs are no longer exempt.
Electric cars registered between 1 April 2017 and 31 March 2025
These vehicles moved to the standard annual VED rate from 1 April 2025. According to official guidance, owners now pay the same £195 annual charge as a petrol or diesel car of the same era. This was a major departure from the previous £0 band.
Electric cars registered before 1 April 2017
Older EVs were placed into the £20 annual band. Although much lower than the standard rate, this represents the first time many of these vehicles have been subject to any VED charge.
Petrol, diesel and hybrid cars registered before 1 April 2025
Cars that were already on the road before the reform retain their original VED band based on their first registration date. However, the standard annual rate for cars registered after 1 April 2017 increased to £195 from 1 April 2025. Cars registered between 2001 and 2017 also moved to the new standard rate if they were previously in a different band. The RAC guide to VED changes confirms these transitions for existing vehicles.
Cars registered before 2001 are taxed based on engine size, not CO₂ emissions. These vehicles are not affected by the 2025 VED changes described here.
How much will electric car tax be in 2025?
The answer depends on when the electric car was first registered and whether it is new or already on the road.
New electric cars registered on or after 1 April 2025
The government has set a first-year VED rate of £10 for zero-emission vehicles registered from this date. From year two onward, owners pay the standard annual rate, which the sources confirm as £200 for the 2025/26 period. The £10 first-year rate is a deliberate incentive, though far smaller than the previous zero rate.
Existing electric cars already on the road
As outlined in the previous section, EVs registered between 1 April 2017 and 31 March 2025 now pay the standard annual rate of £195 (or £200 in some sources for the subsequent year). Those registered before April 2017 pay £20 per year.
The Expensive Car Supplement for EVs
The supplement – an extra annual charge of £425 for five years – originally applied to cars with a list price over £40,000. From 1 April 2026, the threshold for electric cars rises to £50,000, and the supplement applies only to EVs first registered from 1 April 2025 onward. Petrol and diesel cars continue to follow the general threshold rules set out in the official tables.
If you buy a new EV with a list price exceeding £50,000 (or £40,000 before April 2026), you may be liable for the Expensive Car Supplement. This adds £425 per year for five years, starting from the second licence year.
What are the first year VED rates for new cars from April 2025?
First-year rates are set according to CO₂ emissions bands and apply to all new petrol, diesel, hybrid and electric cars registered on or after 1 April 2025.
First-year bands for petrol and diesel cars
Based on the information from industry sources, the bands are as follows (all figures in GBP):
- 1–50 g/km CO₂: £110 first year
- 51–75 g/km CO₂: £130
- Higher emission bands increase progressively, up to £2,745 for the most polluting cars (Band M).
The reform tightens the tax gap between low‑emission and high‑emission vehicles, making high‑CO₂ new cars significantly more expensive to tax in their first year.
Hybrid and plug-in hybrid cars
Hybrids lost some of their previous tax advantages from 2025. A plug-in hybrid with CO₂ emissions of 1–50 g/km still pays £110 in the first year, but the subsequent standard rate of £195 now applies, whereas previously some hybrids had reduced rates.
First-year rate for electric cars
As noted, new EVs pay only £10 in the first year. This is the lowest first-year rate available for any car. Further details can be found in the Halliwell Jones breakdown of VED changes.
Use the official VED rate tables published by the DVLA. The most authoritative source for the 2026 rates is the V149 PDF, which provides band‑by‑band figures for cars, motorcycles and light goods vehicles.
Will there be further car tax changes in 2026?
Yes. According to the official V149 PDF and the RAC, further adjustments are scheduled for 1 April 2026. The timeline below summarises the key events.
- : New first‑year VED rates commence. Standard rate rises to £195. EV owners begin paying £10 first year.
- : Existing EVs move to the standard rate (£195) or £20 band depending on registration date.
- : Expected further rise to the standard rate (proposed but not yet law). The Expensive Car Supplement threshold for EVs increases to £50,000.
- Late 2025 / early 2026: Official GOV.UK updates expected ahead of the 2026 changes, including new rate tables.
The exact 2026 rates are not yet finalised. The government is expected to publish them in the 2026 Budget, likely in late 2025.
What is confirmed and what remains uncertain about the 2025 car tax changes?
| Established information | Information that remains unclear |
|---|---|
| Standard rate of £195 from 1 April 2025 for most cars. | The exact rates for April 2026 are not yet final. Proposals suggest a further increase but no legislation has passed. |
| EV first‑year rate of £10, subsequent year rate of £200. | The impact of potential new luxury car thresholds on the Expensive Car Supplement has not been detailed for all fuel types. |
| First‑year VED bands for new petrol/diesel cars based on CO₂ emissions are updated annually by HMRC. | Whether the standard rate will be uprated further by April 2026 is uncertain. |
| Older EV owners (pre‑2017) pay £20. |
Why are these car tax changes happening?
The 2025 reforms align with the government’s objective to replace lost fuel duty revenue as the electric vehicle fleet expands. By phasing out the EV exemption, the Treasury broadens the tax base. At the same time, raising first‑year rates for high‑emission cars encourages buyers to choose cleaner models.
The £195 standard rate represents an approximate 10% increase from the previous standard rate of £180, in line with RPI inflation. Owners of cars registered before 2001 are unaffected because they fall under a separate engine‑size‑based tax system.
What do official sources say about the 2025 VED changes?
“Electric, zero or low emission cars registered on or after 1 April 2025. You’ll pay £10 for the first year. After that, you’ll pay the standard rate of £200.”
GOV.UK guidance
“Since 2025 VED rule changes, cars with CO2 emissions below 100g/km no longer qualify for free road tax.”
RAC
“From April 2025, that standard rate will be £195 per year for any car (regardless of engine size or CO2).”
Halliwell Jones
The official DVLA document V149 – published as a PDF on GOV.UK – provides the exact banding tables for first‑year rates and is considered the definitive reference for 2026 rates. The GOV.UK VED rates for cars registered after April 2017 remain the primary source for current bandings.
What should drivers do next?
Check your car’s specific VED band using your V5C registration document and the official online calculator. Budget for a minimum of £195 per year for any car registered after 2017. Expect further announcements regarding the Expensive Car Supplement threshold for EVs. The older car tax rules are covered in a separate guide: Older Car Tax UK: Exemptions, 2026 Changes Explained.
Frequently asked questions
What is the car tax changes 2025 PDF?
The official document is DVLA form V149, published at assets.publishing.service.gov.uk. It contains the full rates table for cars, motorcycles, and light goods vehicles.
Are there car tax changes for older cars in 2025?
Cars registered before 2001 are taxed based on engine size, not CO₂, and are not affected by these CO₂-based VED changes. Cars registered between 2001 and 2017 are subject to the standard £195 rate from April 2025.
Can I use a road tax calculator by reg?
Yes. You can use the official GOV.UK vehicle tax rate lookup using your car’s registration number. It will show you the exact rate based on your car’s CO₂ emissions and registration date.
Do electric cars still get a discount after April 2025?
The only discount is the £10 first-year rate for new EVs. After that, the standard annual rate applies. Existing EVs are treated like any other car.
What happens if I buy an EV between now and April 2025?
If you register a new EV before 1 April 2025, you benefit from the £0 first-year rate for that first year. From April 2025, the standard rate will apply to that vehicle from year two onward.
Will the £10 first-year rate apply to used EVs?
No. The £10 rate is only for new zero-emission cars first registered on or after 1 April 2025. Used EVs already registered will have already moved into the standard rate or a legacy band.
How does the Expensive Car Supplement work for petrol cars in 2025?
For non-EV cars, the supplement applies to those with a list price over £40,000 and adds £425 per year for five years, starting from the second licence year.
Where can I find the official 2025 VED rates?
The GOV.UK page on vehicle tax rate tables (see external links below) and the V149 PDF are the authoritative sources.
For more context on personal tax bands, see the related guide: UK Income Tax Rates 2024/25: Bands & Thresholds Explained.
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