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Do electric cars pay road tax? It鈥檚 an important question for anyone looking to make the switch to an EV.

Until recently this question was simple to answer: 鈥淣o.鈥� However, that answer is soon to change, with the Autumn 2024 budget confirming what was long promised 鈥� that free road tax for electric vehicles is soon coming to an end.

Confused? Let us explain all about road tax, and how tax changes are about to affect electric car owners.

What is Road Tax?

Let鈥檚 get a pedantic point out of the way 鈥� road tax isn鈥檛 really road tax at all, it鈥檚 Vehicle Excise Duty (VED). The revenue from VED isn鈥檛 ringfenced to pay for roadbuilding and repairs, so to call it road tax is kind of misleading.

Instead, 鈥榬oad tax鈥� (as almost everyone calls it) is paid by most car owners as a revenue-raiser for the government, but also as a means of influencing drivers to choose low-emission cars.

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How is road tax calculated?

When a car is first registered, 12 months of road tax is included in the on-the-road charges. How much you pay depends on how much carbon dioxide (CO2) a car emits. The more CO2 it pumps out, the higher the first-year charge.

Until 2025, first year road tax for electric cars cost nothing. However, as of 1 April, 2024, fully-electric cars will pay the lowest first year rate of 拢10 鈥� and it鈥檒l stay at that negligible amount until April 2029.

Rates for slightly more polluting vehicles are significantly more 鈥� cars emitting between 1-50g/km (currently only achievable by plug-in hybrids) will pay 拢110, while cars emitting between 51-75g/km will pay 拢130.

At the other end of the scale, cars that emit above 75g/km 鈥� again, a rate currently only achievable by plug-in hybrid vehicles 鈥� will see their rates doubled from the 2024 amount. That means a standard family hatchback, like a VW Golf, will pay 拢440 for their first year of tax. The most polluting vehicles will pay over 拢5,000.

After a year on the road the owner must pay again. This was made more simple in the 2025 budget 鈥� all cars, whether petrol, diesel or electric, must pay 拢190 a year. There was previously a 拢10 discount for hybrid vehicles, and electric cars used to be exempt, but now all types of cars pay the same amount. This rate is subject to change, but at the moment is set at 拢190.

There鈥檚 an extra differentiator based on your car鈥檚 price. Vehicles with a list price over 拢40,000 must pay an additional 拢410 for years 2-6 of ownership. Again, electric cars were previously exempt from this, but as of April 2025 they will need to pay them.

However, the Government has said it would consider raising the threshold for electric cars, noting that they鈥檙e usually more expensive to buy than petrol or diesel equivalents.

This all applies to cars registered since April 2017. Different rates apply to older cars, with carbon dioxide emissions being key to the cost for cars registered between March 2001 and April 2017.

Do you pay road tax on electric cars?

You will do soon. After 1 April, 2025, electric cars will attract a 拢10 first year tax rate and a 拢190 bill annually thereafter. In addition, they will no longer be exempt from the Expensive Car supplement, so vehicles with a list price over 拢40,000 will be liable for an additional 拢410 in years 2-6 of ownership.

Electric vehicles registered between 2017 and 2025 will attract the 拢190 annual rate, while electric vehicles registered before 2017 will pay road tax in Band B 鈥� set at 拢20 per year.

Electric vehicle tax remains far cheaper than a conventional or even a hybrid vehicle, as a way to incentivise people into buying new electric cars.

There are also big savings for anyone running an EV as a company car.

Road tax on electric cars FAQs

Do you pay road tax on electric cars over 拢40,000?

Not yet. Electric vehicles are exempt from the extra charge. That will no longer be the case from April 2025, when electric car owners will have to pay the extra 拢410. That鈥檚 the current rate and could change between now and April.

How much is road tax on an electric car?

For now, it costs nothing. There鈥檚 no road tax cost for an electric car when it first registered, or in subsequent years.

That comes to an end from April 2025. The first-year rate for electric cars will be 拢10. The regular annual road tax payments will jump from nothing to 拢190.

Do hybrid cars need to pay road tax?

Yes, hybrid car owners pay road tax. How much depends on the car鈥檚 emissions and when it was first registered.

Hybrids previously attracted very low rates of tax, but they鈥檝e been increased from 1 April 2025. Hybrids emitting between 1-50g/km of CO2 will pay 拢110 for their first year of tax, while emissions between 51-75g/km will pay 拢130.

From the car鈥檚 first birthday onwards, hybrids pay 拢1890 per year, the same as a regular petrol, diesel or electric car.

There鈥檚 an extra 拢410 each year for five years on top of the standard rate for cars costing over 拢40,000 when new. It applies to hybrid cars as well as petrol and diesels.

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