Road Tax Changes in the UK – What You Need to Know from April 2025

UK Road Tax Changes 2025 – Everything You Need to Know

The UK government is implementing major road tax changes in 2025, impacting petrol, diesel, hybrid, and electric vehicle (EV) owners. These updates to Vehicle Excise Duty (VED) will take effect on April 1, 2025, and will introduce higher first-year tax rates and end tax exemptions for EVs.

At Todds of Campsie, we want to help you understand these changes and how they affect your vehicle costs. Here’s everything you need to know.

Road Tax Changes for Electric Vehicles (EVs)

For the first time, electric vehicles (EVs) will no longer be exempt from road tax. The changes are as follows:

• EVs Registered After April 1, 2025: First-year road tax will be £10, increasing to £195 per year from year two.
• EVs Registered Between 2017 and 2025: These vehicles will start paying the standard annual rate of £195 from April 2025.
• Older EVs (Registered Between 2001 and 2017): These will now be taxed at £20 per year.
• Expensive EVs (Over £40,000 New Price): These will be subject to the expensive car supplement, adding £425 per year for years two to six.

This is a significant shift, making EV ownership slightly more expensive.

Higher First-Year Tax Rates for Petrol, Diesel, and Hybrid Vehicles

New petrol, diesel, and hybrid vehicles will see increased first-year VED rates based on CO₂ emissions. The more emissions a vehicle produces, the higher the tax:

• 1–50 g/km CO₂: £110 (was £10)
• 76–90 g/km CO₂: £270 (was £135)
• 131–150 g/km CO₂: £540 (was £270)
• 191–225 g/km CO₂: £3,300 (was £1,650)
• Over 255 g/km CO₂: £5,490 (was £2,745)

After the first year, all vehicles move to the standard £195 per year tax rate.

What This Means for Car Buyers

1. Electric Car Buyers: EVs will no longer be tax-free, but they still offer significant fuel savings.
2. Petrol/Diesel Buyers: Higher CO₂ emissions mean steeper upfront costs.
3. Luxury Vehicle Owners: Vehicles over £40,000 will attract additional charges.

If you’re considering purchasing a new car in 2024, it may be worth factoring in these road tax increases when deciding between an EV, hybrid, or traditional fuel vehicle.

Additional Road Tax Changes for Older Vehicles

Vehicles registered between March 1, 2001, and March 31, 2017, will also see tax increases based on CO₂ emissions. Some of the key changes include:

• Up to 100 g/km CO₂: £20 (previously £0)
• 101–110 g/km CO₂: £20 (no change)
• 111–120 g/km CO₂: £35 (previously £30)
• 121–130 g/km CO₂: £165 (previously £160)
• 131–140 g/km CO₂: £195 (previously £190)
• 151–165 g/km CO₂: £265 (previously £255)
• 166–175 g/km CO₂: £315 (previously £305)

These changes impact older petrol and diesel vehicles, making them slightly more expensive to run.

How Todds of Campsie Can Help

Quote from Jonathan Todd, General Manager at Todds of Campsie:
“These road tax changes will have a significant impact on vehicle owners, especially those considering an EV. At Todds of Campsie, we are committed to helping our customers navigate these updates and find the most cost-effective and efficient vehicle for their needs.”

At Todds of Campsie, we stock a range of fuel-efficient petrol, hybrid, and electric vehicles, ensuring you can make an informed decision that suits your budget and lifestyle. Our expert team is here to help guide you through the upcoming tax changes and find the best vehicle for you.

📍 Visit us today to explore our latest models or contact us for advice on road tax changes.

Stay Ahead of the Changes

Understanding these road tax updates is crucial, whether you’re an existing car owner or planning to buy a new vehicle. Keep up to date with the latest motoring news by following Todds of Campsie.

For more information, visit gov.uk or speak to our team today!