How much is car tax in the UK?
From April 2021, you'll pay £155 for petrol and diesel cars, and £145 for hybrids and alternative fuel cars. Zero-emission cars (such as electric vehicles) are exempt from car tax. If your car cost more than £40,000 when bought new, you have to pay an extra £335 (April 2021 rate, see below) per year for five years, on top of the standard rate.
How does car tax work?
For cars registered on or after 1 March 2001, the rates are split into bands – the lower the emissions, the lower the vehicle tax. In order to tax a vehicle, suitable insurance cover must be in place, while the car must also have a valid MOT. Both are checked electronically when you apply for car tax.
What is the new tax system for new cars in the UK?
From 1 April 2017, the system for taxing a new car in the UK changed. VED will still be calculated on a vehicle’s CO2 emissions, but only cars with 0g/km CO2 emissions will be exempt from paying tax. The changes have been introduced in direct response to falling CO2 emissions levels, meaning many motorists are paying little or no VED.