On 1st April 2017, a new set of rules governing VED (Vehicle Excise Duty) came into force. Many motorists seem to be rather confused about how the car tax changes will affect them, and so we have explained everything you need to know in this useful guide. 

The first thing to be aware of is that the new rules only affect NEW VEHICLES registered AFTER 1st April 2017.

Any vehicles registered BEFORE MARCH 2001 are taxed on how much they pollute in terms of Carbon Monoxide (CO2).  These rates are based on engine size, so anything with a capacity less than 1549cc pays £145 and anything greater £230 per year.

Vehicles registered between March 2001 and March 2017 are taxed on CO2 emissions with both a first year and then yearly rate. See the VED tax bands table below:

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Vehicles registered from 1st April 2017 will continue to be taxed on their CO2 emissions in the same format, but will now face more expensive rates.  There will be a first-year rate and then a flat rate for the following years. Unless your vehicle has zero emissions, after the first year, you will pay a flat rate of £140 per year or £130 for alternative fuel vehicles. Zero emission cars will remain tax-free. See table below for VED band from 1st April 2017 onwards:

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However, if your vehicle has a list price of above £40,000, you will be required to pay an additional £310 per year, for the first five years. This means that electric cars over £40,000 will pay a total of £310 every year for the first five years, alternative fuel vehicles will pay £440 every year for the first five years and petrol and diesel cars £450 every year for the first five years.  After five years these rates change to zero, £130 and £140 respectively.

If you are thinking about buying your next car, visit AvailableCar.com, where not only can you see how much you will save against new car prices when buying from us, but you can also see how much road tax you will pay on each and every one of our 5,000+ cars.


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