The way we pay VED (annual road tax) in the UK has changed to a flat rate system after the first year. These changes will affect new cars registered on or after the 1st April 2017.
In 2017, during the first year of driving a car, VED will be calculated based on CO2 emissions. However, the rates are changing. As of the 1st April, rather than paying zero VED on cars that emit less than 100g/km of CO2 emissions, only the cars that have exactly zero g/km figures will be exempt. These cars include electric and hydrogen cars.
After the first year, there will be a flat rate of £140 for all cars. There’s also a tax of £310 to pay annually for five years for cars that cost more than £40,000.
All cars will have to be sold with information about how much it will cost to tax. It’s recommended that you check this first to see if you can afford the car that you would like to buy.
In the Autumn Budget, Chancellor Philip Hammond announced that all new diesel cars from 1 April 2018 will face going up a VED band if they fail to meet the latest Euro 6 standards under real-world testing.
New cars will have to meet the real driving emissions (RDE) step 2 test that forms part of the current EU type approval process. This means new cars can pollute up to 1.5 times the current 80mg/km NOx limit under real-world driving if they are to avoid going up a tax band.
The changes only apply to diesel cars, not vans, and do not impact the subsequent £140 yearly fees all cars have to pay after the first year. The table below shows how the new rates will work. Any car failing to meet the Euro 6 standards in real world testing would move up a band, and thus pay anything from £15 to £500 more in first year rates. Not to worry though, you'll find our range of new diesel cars fall well within the Euro 6 standards.
The calculations are based on your car’s CO2 emissions, starting at £10 for those cars with between 0 – 50g/km figures. After the first year, you will have to pay £140 annually.
VED car tax bands: April 2017 Onwards
|Emissions (g/CO2/km)||First year rate||Standard rate|
Cars above £40,000 pay £310 annual supplement for five years
These changes will affect most drivers looking to buy a new car after the 1st April 2017. Cars that are registered before that date will not be affected.
|VED Band||CO2 Emissions||Annual rate||First year rate|
|A||Up to 100 g/km||£0||£0|
|M||Over 255 g/km||£515||£1,120|
The pre-April 2017 registrations from our Used Car selection are subject to the aside table of VED charges. If the car has been registered before this date you can expect to pay a variable scale of annual rates after the first year based on your emissions specifically.