Vehicle Excise Duty - or road tax, as it is more commonly referred to - is part and parcel of owning a car. Over the years, this tax has changed and increased, with the Government usually adjusting it automatically to follow inflation.
A big change for road tax is set to come into play this April, with large numbers of cars affected. Here at Prestige Cars Kent, we’ve got a variety of cars which fall under different tax bands, so if you’re looking to save money, then we may have the car for you. In this article, however, we’re going to cover everything you need to know about this most recent round of VED changes.
What’s changing?
From April 1, things are set to change when it comes to car tax. One of those most notable changes is the increase of the ‘expensive car supplement’. Essentially, this ‘luxury car tax’ - adding to vehicles costing over £40,000 for the first years following the first tax payment made when a car is a year old - is increasing from £410 to £425 and is made on top of the standard rate of £195.
This increase means that drivers will pay a total of £620 a year from years two to six, amounting to £3,100 extra in VED over six years. It’s worth noting that the standard flat rate paid by all cars is also increasing from £190 to £195 as of April 1.
EV/Electric Vehicle Tax Changes
A number of car types are affected, with one of the most prominent being electric vehicles. From April 1, EVs are no longer exempt from paying car tax and will incur a first-year rate of £10, alongside the aforementioned expensive car supplement if they cost over £40,000. From the second year onwards, EVs will incur the standard rate applied to other cars of £195 a year.
In addition, electric vehicles registered between April 1, 2017 and March 31, 2025, will now have to pay the same standard rate of tax as all other cars - £195.
What about hybrids?
It’s not good news for plug-in hybrids, either. Cars emitting between 1 and 50g/km CO2 - which have been free to tax up until this point - will now cost £110 for the first year to tax. Likewise, new vehicles emitting between 51 and 75g/km CO2 will see tax costs rise to £135 from £30.
Are cars taxed depending on their age?
That’s right. If you have a car first registered on or after April 1, 2017, it’ll be taxed in line with one of three VED bands - zero, standard and premium. However, cars registered between March 1, 2001 and March 31, 2017, are taxed depending on their CO2, split into bands. As before, if you’ve got a lower-emitting car it’ll cost less to tax than something which is more heavily polluting.
Cars registered before March 1, 2001, meanwhile, are split depending on their engine size. This divide seems them separated into cars not over 1,549cc and over 1,549cc.
What could happen if I didn’t tax my car?
It’s not a good idea to leave your car untaxed. If you drive an untaxed vehicle, you could be hit with a fine of £80, reduced to £40 if paid within 28 days. Fail to pay this and the fine could rise to £1,000 or five times the amount of tax due. You also risk coming back to your car to find it clamped.
If you plan to take your car off the road and leave it untaxed, you’ll need to make a Statutory Off Road Notification - SORN - to let authorities know that you won’t be driving it. You’ll also need to keep it off the public road, in an area such as a driveway or garage.
Tax is a part of the whole car experience and here at Prestige Cars Kent, we’re specialists in making sure that you find the right car for your budget. So if you’re worried about how much tax you could be spending on a new car - or want to switch to a model which incurs less tax - then get in touch today to find out how we could help.