If you own a car in the UK, there’s an important car tax changes coming that could increase your bill. From 1 April 2024, new Vehicle Excise Duty (VED) rates come into effect, and for the first time, electric vehicle (EV) owners will have to pay car tax.

Whether you drive a petrol, diesel, hybrid, or electric car, these changes could affect you. So, what’s changing, and how much will you have to pay? Let’s break it down.

What Is Vehicle Excise Duty (VED)?

VED, commonly known as car tax or road tax, is a yearly charge that applies to most vehicles on UK roads. The amount you pay depends on:

• Your car’s CO2 emissions (for newer vehicles)
• When your car was registered
• The type of fuel it uses

Previously, electric vehicles were exempt from VED, but that’s about to change.

Who Will Be Affected by the New Car Tax Rules?

From 1 April 2024, two major changes will hit UK drivers:

1. Electric Vehicle Owners Will Start Paying Tax

If you drive an electric car, you’ve enjoyed zero VED until now. But from April, EVs will be taxed just like petrol and diesel cars.

• First-year rate: £20
• Standard annual rate (from the second year): £195

That’s the same rate as petrol and diesel cars, marking the end of free road tax for EVs.

2. Heavily Polluting Cars Will Be Taxed More

If you drive a high-emission diesel vehicle, your VED could rise significantly.

• Diesel cars emitting over 250g/km of CO2 will be taxed at a staggering £5,490 in the first year – that’s more than £2,000 higher than last year.

This move is aimed at reducing emissions and pushing drivers towards cleaner vehicles.

How Much Will You Have to Pay?

For Petrol and Diesel Cars Registered After April 2017

The amount you pay in the first year depends on your car’s emissions:

From the second year onwards, all petrol, diesel, and electric cars will pay £195 per year.

For Diesel Cars That Don’t Meet New Emissions Standards

If your diesel car doesn’t meet Real Driving Emissions 2 (RDE2) standards, you’ll pay more in the first year. Here’s what that looks like:

If you’re unsure whether your diesel car meets RDE2 standards, check your V5C logbook or the DVLA website.

Premium Car Tax – Are You Affected?

If your car was originally listed for over £40,000, you’ll need to pay an extra £410 per year on top of the standard VED. This applies for the first five years of ownership, after which you’ll only pay the standard £195 rate.

Are Any Drivers Exempt?

Some drivers won’t have to pay VED. You’re exempt if you:

✔ Receive Personal Independence Payment (PIP) with the enhanced mobility component
✔ Receive the higher rate mobility component of Disability Living Allowance (DLA)

If your car is off the road, you don’t have to pay VED, but you must declare a Statutory Off Road Notification (SORN) to the DVLA.

How to Pay Your Car Tax

Paying VED is simple – all you need is your reference number from:

✔ Your DVLA tax reminder (V11)
✔ Your vehicle logbook (V5C)
✔ The green ‘new keeper’ slip if you’ve just bought a car

You can then pay:

✅ Online via the DVLA website
✅ At the Post Office
✅ By phone

If you don’t have any of these documents, you’ll need to apply for a new logbook before paying.

What This Means for You

If you drive an electric car, you’ll soon be paying the same tax as petrol and diesel drivers. And if your car is heavily polluting, your VED could jump by thousands.

While the changes won’t affect all drivers equally, they do signal a clear shift towards taxing all vehicles more fairly, regardless of fuel type.

What Should You Do Next?

✔ Check your car’s emissions – Look at your logbook or check online to see which tax band you’re in.
✔ Work out your tax costs – If you’re planning to buy a car, factor in the VED costs for the first year and beyond.
✔ Set up payment reminders – Car tax must be paid on time, or you could face fines.

The bottom line? VED is going up, and even electric cars won’t be exempt anymore. Make sure you know what you’ll need to pay before April so you’re not caught out.