If you own a car or are thinking of buying one, you’ll need to budget for car tax. A common question drivers ask is, how much is car tax? Car tax, often called vehicle excise duty, is calculated on your vehicle’s CO2 emissions, fuel type, and the date it was registered.
The cost isn’t a single fixed price. It varies a lot depending on your specific vehicle. This guide will walk you through exactly how it’s calculated, what you can expect to pay, and how to handle the payment process.
We’ll cover new and old cars, petrol, diesel, and electric vehicles, and explain the rules so you can find your car’s tax rate easily.
How Much Is Car Tax
To find out how much your car tax will be, you need two key pieces of information: the date the car was first registered and its official CO2 emissions figure. This data is used to place your vehicle into a specific tax band.
You can find these details on your V5C registration certificate (log book). The most straightforward way to check is to use the government’s official vehicle tax service online, where you just enter your number plate.
Understanding Vehicle Tax Bands
The UK system for car tax has changed several times. Which set of rules applies depends entirely on when your car was first registered. There are three main systems in operation.
Cars Registered After 1 April 2017
This is the current system. The first year rate (often called the “showroom tax”) is based on the car’s CO2 emissions. After the first year, you pay a standard annual rate.
There are three important exceptions:
- Zero-emission cars (fully electric) pay £0 for both the first year and subsequent years.
- Plug-in hybrid cars get a discounted rate, depending on their electric range and emissions.
- Cars with a list price over £40,000 pay a premium rate of £410 per year on top of the standard rate for five years, starting from the second time the tax is due.
Cars Registered Between 1 March 2001 and 31 March 2017
For this 16-year period, cars were taxed based purely on CO2 emissions. They were placed in bands from A (lowest) to M (highest). The annual cost still varies significantly based on that band.
You’ll need to know your exact CO2 figure in g/km to find the right band. Diesel cars in these bands often paid a slightly higher rate than petrol cars in the same band due to different emissions standards.
Cars Registered Before 1 March 2001
For these older vehicles, the tax is based on engine size (cc). The system is much simpler:
- Engine size 1549cc or less: £200 per year.
- Engine size over 1549cc: £325 per year.
There is no emissions-based calculation for these classic cars.
Current Car Tax Rates For Newer Vehicles
Let’s look at the specific costs for cars registered in the latest system (post-April 2017). These rates are for the 2024/25 tax year.
First Year Rates (Based on CO2 Emissions):
- 0g/km: £0
- 1-50g/km: £10
- 51-75g/km: £30
- 76-90g/km: £135
- 91-100g/km: £175
- 101-110g/km: £195
- 111-130g/km: £225
- 131-150g/km: £265
- 151-170g/km: £325
- 171-190g/km: £410
- 191-225g/km: £650
- 226-255g/km: £925
- Over 255g/km: £1,570
Standard Annual Rate (After First Year): Most cars fall into the standard rate, which is £190 per year. Zero-emission cars continue to pay £0.
The £40,000 Premium Surcharge: If your car had a list price over £40,000 when new, you pay an extra £410 per year for five years (from the second year of registration onwards). After that, it drops to the standard rate.
How To Check Your Car Tax Cost
You don’t need to guess or do complex math. The government provides a free and instant online tool.
Using The Official GOV.UK Vehicle Tax Service
This is the most reliable method. Follow these steps:
- Go to the “Vehicle Tax” page on the GOV.UK website.
- Click “Check Vehicle Tax Rate.”
- Enter your vehicle’s registration number (number plate).
- The tool will instantly show you the 12-month and 6-month tax rates for your car, along with its CO2 emissions and tax band.
It will also tell you when the current tax expires, which is useful if you’re buying a used car.
Information On Your V5C Log Book
Your V5C document contains the essential details needed to determine the tax band: the date of first registration and the CO2 emissions. You can use this information to cross-reference with the tax tables published by the DVLA each year.
Remember, the V5C itself does not show the monetary amount you need to pay, as tax rates can change. It provides the data used to calculate it.
Ways To Pay for Your Car Tax
Gone are the days of the paper tax disc on your windscreen. Today, payment is handled electronically, and you have several flexible options.
Payment Frequencies Available
You can choose to spread the cost, though paying annually is usually the cheapest option.
- Annually: One single payment for the year.
- Every Six Months: You pay 10% more than half the annual rate.
- Monthly by Direct Debit: You pay an extra 5% on top of the annual rate, spread over 12 months. This is the most popular method for budgeting.
Setting up a Direct Debit also means your tax will automatically renew, so you avoid the risk of forgetting and driving untaxed.
Required Documents For Taxing A Car
Before you can tax a vehicle, you need to have certain things in order. You will need:
- A valid V5C log book in your name (with the correct address).
- A valid MOT test certificate (if the car is over 3 years old).
- Valid vehicle insurance. The DVLA checks this electronically against the Motor Insurance Database.
If you’ve just bought a car, you cannot use the green “new keeper” slip from the V5C to tax it online. You must wait for the DVLA to send you the new log book or use the reference number from that slip in a Post Office that deals with vehicle tax.
Exemptions and Discounts on Car Tax
Not every vehicle is subject to the standard charges. Several groups are eligible for a reduced rate or a complete exemption.
Historic And Classic Vehicles
Cars built more than 40 years ago are eligible for a historic vehicle tax exemption. The date rolls forward each year on 1 April. For example, in 2024, vehicles built before 1 January 1984 are exempt.
Even though the tax is free, you must still go through the process of “taxing” the vehicle each year to keep it legally on the road. You can do this online or at the Post Office with your V5C.
Disabled Drivers And Passengers
If you recieve a qualifying disability benefit, you may be eligible for a 100% exemption from car tax. You can also get a 50% reduction if you get a War Pensioners’ Mobility Supplement.
You need to apply for this exemption using form V10 and provide the relevant award letter from the DWP. The exemption applies to the vehicle, not the person, so it can be used by anyone driving for the disabled person’s needs.
Electric And Ultra-Low Emission Vehicles
Fully electric vehicles (EVs) currently pay £0 vehicle tax. This is a significant incentive and running cost saving. However, from April 2025, new zero-emission cars will start paying the standard annual rate (£190), though they will still be exempt from the first year rate and the expensive car supplement.
Plug-in hybrids (PHEVs) benefit from lower first year rates based on their emissions and electric range, and then pay the standard rate after that. If a PHEV costs over £40,000, it will also be liable for the premium supplement.
What Happens If You Don’t Pay Car Tax
Driving without tax is a serious offence. The DVLA has powerful enforcement tools, and there is no longer a grace period.
Automatic Fines And Penalties
The DVLA uses automated cameras and databases to check for untaxed vehicles. If your car is spotted without tax, you will be sent an £80 penalty notice (Out of Court Settlement). If you pay this within 28 days, it is reduced to £40.
If you do not pay the fine, the case can go to court, leading to a much larger fine of up to £1,000. The DVLA also has the power to clamp and then impound your vehicle. The costs to release it are high, and if unclaimed, the car will be crushed.
Declaring A Vehicle Off The Road (SORN)
If you are not going to use or keep your car on a public road, you must make a Statutory Off Road Notification (SORN). This means you do not have to pay tax.
You can declare SORN online instantly using the 16-digit number from your V5C. Once a SORN is in place, the vehicle must be kept on private land, like a driveway or garage. Driving a SORN car on the road is illegal, except to a pre-booked MOT appointment.
Remember, tax is not transferable. When you sell a car, you get an automatic refund for any full months remaining. The new owner must tax the car immediately before they drive it.
Planning for Future Car Tax Costs
When buying a car, especially a new one, it’s wise to factor in the future tax costs, not just the first year.
Considering Tax When Buying A New Car
For brand new cars, check both the first year rate and the subsequent standard rate. A car with very high first-year tax might be affordable upfront but check the ongoing cost too.
Be very mindful of the £40,000 list price threshold. Choosing a car with optional extras that push it over this limit will commit you to five years of the £410 premium supplement, adding £2,050 to your total running costs.
Used Car Tax Considerations
For used cars, always use the online checker with the reg number before you buy. A car registered between 2001 and 2017 in a high emissions band (like Band L or M) could cost over £600 per year to tax, which is a significant ongoing expense compared to a newer, more efficient model.
Also, check if a used electric vehicle was registered before April 2025, as it will retain its £0 tax status even after the new rules for EVs begin.
Frequently Asked Questions
How Is Car Tax Calculated?
Car tax is calculated primarily on your vehicle’s CO2 emissions and its date of first registration. Older cars (pre-2001) are taxed on engine size alone. For the newest cars, the list price also becomes a factor if it’s above £40,000.
Where Does My Car Tax Money Go?
Vehicle Excise Duty (VED) is collected by the Treasury. It is not ring-fenced exclusively for roads, but goes into the general government fund used for all public spending, which includes road maintenance and transport projects.
Can I Pay My Car Tax Monthly?
Yes, you can pay by monthly Direct Debit. This incurs a small 5% surcharge on the total annual amount, but it spreads the cost and ensures automatic renewal so you never forget.
Do Electric Cars Pay Car Tax?
Currently, fully electric cars pay £0 vehicle tax. This will change in April 2025, when new zero-emission cars will begin to pay the standard annual rate (£190), but they will still avoid the first-year payment and the expensive car surcharge.
What Happens To Car Tax When I Sell My Car?
When you notify the DVLA that you’ve sold a car (via the V5C), you will automatically recieve a refund for any full months of remaining tax. The new owner is responsible for taxing the vehicle in their own name before they drive it away.