Car Tax Bands Explained: UK Road Tax Rates & Costs

What Is Car Tax (Vehicle Excise Duty)?

Car tax, officially called Vehicle Excise Duty (VED) and commonly known as "road tax," is a compulsory tax paid by vehicle keepers in the UK. Despite its colloquial name, the revenue does not go directly to road maintenance but into the Treasury's general fund.

VED is administered by the Driver and Vehicle Licensing Agency (DVLA). You must tax your vehicle before driving it on public roads. Failure to do so can result in fines of up to £1,000, and the DVLA can clamp or impound untaxed vehicles.

Who Needs to Pay Car Tax?

Anyone who keeps or uses a vehicle on public roads in the UK must pay VED, unless the vehicle is exempt. If your car is not being used on the road, you must make a Statutory Off Road Notification (SORN) to avoid penalties. Importantly, road tax does not transfer when a car is sold. The new owner must tax the vehicle before driving it, and the previous owner receives an automatic refund for any full remaining months.

How Car Tax Bands Work in the UK

The amount of VED you pay depends primarily on when your car was first registered and how much CO2 it emits. The system works differently for cars registered before and after 1 April 2017.

First-Year Rate vs Standard Rate

For cars registered from April 2017 onwards, the VED system has two tiers:

• First-year rate: A one-off payment when the car is first registered, based on its CO2 emissions. Higher-emission vehicles pay significantly more in their first year.
• Standard rate: From the second year onwards, most cars pay a flat annual rate regardless of their emissions. The exception is vehicles with a list price over £40,000, which pay an additional supplement.

CO2 Emissions-Based Bands (Cars Registered After April 2017)

First-year VED rates are determined by the vehicle's CO2 emissions measured in grams per kilometre (g/km). The bands range from 0 g/km (zero-emission vehicles) to over 255 g/km. Here are the current first-year rates:

After the first year, most vehicles pay the standard flat rate of £190 per year.

Tax Bands for Older Cars (Registered Before April 2017)

Cars registered before 1 April 2017 use a different system based on 13 emission bands (A to M). These rates are based solely on the car's CO2 output and apply every year, not just the first year:

Electric and Zero-Emission Vehicles

A significant change took effect in April 2025: electric vehicles (EVs) are no longer exempt from VED. Before this date, zero-emission cars paid no road tax at all. Now, EVs pay the lowest first-year rate (£10) and then the standard annual flat rate from year two onwards, the same as petrol and diesel cars.

However, electric vehicles are exempt from the Expensive Car Supplement (see below), providing some financial advantage for higher-priced EVs.

The Expensive Car Supplement

If your car had a list price (the published price before any discounts) exceeding £40,000 when new, you must pay an additional annual supplement on top of the standard VED rate. This supplement is £410 per year and applies for five years from the second year of registration (years 2 to 6).

After six years of registration, you only pay the standard flat rate. This supplement applies regardless of your car's emissions level, but zero-emission vehicles are exempt.

Example: If you buy a new petrol car with a list price of £45,000 and CO2 emissions of 130 g/km, your VED costs would be:

• Year 1: £220 (first-year rate based on emissions)
• Years 2–6: £190 + £410 = £600 per year (standard rate + expensive car supplement)
• Year 7 onwards: £190 per year (standard rate only)

How to Check Your Car's Tax Band

There are several ways to find out which tax band your car falls into:

Using the DVLA Online Service

Visit the government's vehicle enquiry service and enter your registration number. This will show your car's current tax status, CO2 emissions, and other key details. You can also check your car's MOT history to verify that it is roadworthy and taxed.

Checking via Your V5C Logbook

Your V5C registration certificate lists the vehicle's CO2 emissions and fuel type, which determine the tax band. If you have misplaced your V5C, read our guide on car ownership documentation for details on how to request a replacement.

Using Your Registration Number

Many online tools allow you to check car tax by entering just the registration number. Our free car valuation tool also provides key vehicle details when you enter your reg.

How Car Tax Affects Your Car's Value

While VED is not directly included in a car's market price, it has a real impact on what buyers are willing to pay. Tax band is one of the running costs that savvy buyers always consider before committing to a purchase.

Why Buyers Factor in Running Costs

A car in tax band M (over 255 g/km) costs £735 per year in road tax alone for pre-2017 vehicles. Over a typical three-year ownership period, that is £2,205 in tax. Compare that with a Band A car that costs nothing in tax. When buyers are comparing two similar vehicles, the one with lower running costs often wins, even if it costs slightly more to buy.

This is why fuel-efficient cars tend to hold their value better. The total cost of ownership matters to buyers, not just the purchase price. Curious about what your car is worth right now? Use our free car valuation tool to see how your car's value compares to the market.

High-Tax Diesels and the Clean Air Zone Effect

Diesel vehicles face additional pressure beyond VED. Many UK cities have introduced or are planning Clean Air Zones (CAZ) and Ultra Low Emission Zones (ULEZ), which charge older, higher-emission vehicles to drive within certain areas. London's ULEZ, for example, charges non-compliant vehicles £12.50 per day.

This has created a two-tier market for diesel cars. Newer, compliant diesels (Euro 6 standard) remain competitive, while older diesels (pre-September 2015) have seen sharper depreciation due to the combination of higher VED rates and clean air zone charges.

The Electric Vehicle Tax Advantage (And Why It Is Changing)

Electric vehicles benefited from zero VED until April 2025, which made them more attractive to buyers and helped support resale values. Now that EVs pay the standard rate, this advantage has reduced, though the exemption from the Expensive Car Supplement still benefits higher-end electric models.

As the UK transitions towards its 2035 ban on new petrol and diesel car sales, the long-term trajectory favours electric vehicles. However, the removal of the VED exemption signals that the government expects EVs to contribute to tax revenue, and further changes are likely.

Tips to Reduce Your Car Tax

Choosing a Lower-Emission Vehicle

The most effective way to reduce your car tax is to choose a vehicle with lower CO2 emissions. This primarily affects the first-year rate for post-2017 cars but makes a significant difference for pre-2017 vehicles where the rate applies every year. When shopping for your next car, check both the emissions figure and the corresponding tax band before making a decision.

Use our used car buying guide to understand all the costs you should consider when purchasing a vehicle.

SORN: When You Are Not Using Your Car

If your vehicle is not being used on public roads, you can declare a SORN (Statutory Off Road Notification) to stop paying VED. This is useful for seasonal vehicles, project cars, or cars awaiting sale. A SORN is free to make online and takes effect immediately. Remember that a SORNed car cannot be driven or parked on any public road.

Paying Monthly vs Annually

You can pay your VED annually, every six months, or monthly by direct debit. However, choosing to pay every six months or monthly costs slightly more than paying annually due to a surcharge. If you can afford the lump sum, paying annually saves you money over the course of the year.

Car Tax When Buying or Selling a Used Car

What Happens to Road Tax When You Sell a Car?

When you sell your car and transfer the ownership to the new keeper through the DVLA, the existing road tax is automatically cancelled. You will receive an automatic refund for any full calendar months remaining on your tax. The tax is not transferred with the vehicle.

For the full step-by-step process, see our guide on how to legally transfer car ownership.

The Buyer's Responsibility

As a buyer, you must tax the vehicle before driving it away. You cannot drive a car on public roads without valid tax, even if the previous owner's tax was still in date when you completed the purchase. You can tax the car at a Post Office, online at gov.uk, or by phone.

You will need the new keeper supplement (V5C/2) from the logbook, valid insurance, and a current MOT certificate (for vehicles over three years old).

Getting a Refund on Remaining Tax

If you sell, scrap, or SORN your vehicle, the DVLA will automatically refund any remaining full months of VED. The refund is sent to the registered keeper by cheque or returned to the payment card used. Partial months are not refunded.

Frequently Asked Questions About UK Car Tax