Road tax, or Vehicle Exercise Duty (VED), is an annual tax that vehicle drivers must pay. The amount of road tax you will pay depends on the age and type of vehicle and the emissions it produces. This money is then used by the government to pay for things such as road work and maintenance.
Currently, the owners of zero-emission battery electric vehicles (BEVs) are exempt from this tax, due to their lack of tailpipe emissions. Similarly, plug-in hybrid vehicles have seen lower rates of road tax due to their reduced emissions.
However, this is apt to change, with the UK government updating the rules surrounding road tax for electric cars.
Why is EV Road Tax Changing?
In 2023, chancellor Jeremy Hunt announced that EV owners will have to pay road tax from 1st April 2025 onwards. He stated that this change was intended to ‘make the motoring tax system fairer’ for all drivers.
This will be used to help fund the continued development of EV infrastructure in the UK – helping push the country towards its Net Zero targets.
Currently, the UK government aims to ban the sale of all new internal combustion engine (ICE) vehicles by 2035 and is encouraging drivers to switch to EVs and cut down their carbon footprints.
Taxing Your EV
Although EV owners are currently exempt from paying a fee for vehicle tax, they must still tax and register their vehicle. This is a legal requirement for all vehicle owners, regardless of whether they are EVs or not, and failing to tax your vehicle could result in fines or other penalties. Find out more about taxing your vehicle.
How Much Will Electric Car Tax be in 2025?
From 1st April 2025, EV owners in the UK will have to pay VED (road tax).
The exact changes are as follows:
- New EVs registered on or after 1st April 2025 will have to pay the lowest first-year rate of VED, which is currently £10 per year.
- In the second year, new EVs registered on or after 1st April 2025 will have to pay the standard rate of VED which is currently £180 per year.
- EVs registered between 1st April 2017 and 31st March 2025 will have to have the standard rate of VED.
- If you have a zero or low emission vehicle registered between 1st March 2001 and 30th March 2017, you will be moved from Band A to Band B, which is currently £20 per year.
- Zero emission vans will be moved to the petrol and diesel light goods vehicle rate which is currently £290 per year.
- Zero emission motorcycles will move to the rate for smallest engine sizes, currently £22 per year.
| New EVs registered on or after 1st April 2025 | EVs registered between 1st April 2017 – 31st March 2025 | EVs registered between 1st March 2001 – 30th March 2017 | Zero emission vans | Zero emission motorcycles |
| £10 for the first year £180 for the second year | £180 per year (Standard rate of VED) | £20 per year (Moved from Band A to Band B) | £290 per year (light goods vehicle rate) | £22 per year (smallest engine size rate) |
This will be a legal requirement for all drivers, so it is important to check which category your vehicle falls under to avoid incurring a fine or losing access to your vehicle.
EVs will still be exempt from Clean Air Zone (CAZ) fees and Ultra Low Emission Zone (ULEZ) fees.
Hybrid Car Tax Rules
Currently, hybrid vehicles are still liable to pay EV road tax at a lower rate than petrol or diesel cars, due to their reduced emissions. However, this is set to change from 1st April 2025, as hybrid car tax will be charged at the standard rate.
How Will Changes to Road Tax for Electric Cars Affect EV Drivers?
Despite the imminent changes to road tax for electric cars, there are still many financial benefits to switching to electric vehicles. For example, the running costs associated with EVs are much lower than those of ICE vehicles as the cost of charging your vehicle will be significantly lower than filling it with petrol or diesel.
EVs also see reduced maintenance costs as their battery contains fewer moving parts than an internal combustion engine, meaning there are fewer things that can go wrong leading to expensive repairs.
To find out more about the savings you could make by switching to EVs, check out our pros and cons of EVs guide.
Thinking of Making the Switch?
If you’re ready to embrace the future of sustainable transport, Yü Charge can help! We install EV charge points for homes and businesses, with a range of charging options available, we have a charger to suit everyone!
Get your free no obligation installation quote today and get ready to experience a greener way to travel.