1st April 2017 Car Tax Changes: VED Simplified

VED, or more commonly known as Road Tax, is an unavoidable and mandatory charge for all cars bought in the UK. Currently the amount relies on the expense and economy of the vehicle and are generally low(ish), the cheaper and cleaner the better, but 2017 is seeing a massive change in structure, costs and requirements and this will hopefully make it a little clearer for you. It will effect the registered owners of new cars. BUT it is all dependent on the date of registration. The changes all come into play on April 1st, so we’ve created some helpful tables to aid you in working out how the changes will affect you.

Cars Registered After Tax change on April 1st 2017

First year Road Tax bands and prices - Cars registered After April 1st 2017

CO2 Emissions g/km	Petrol and Diesel cars	Alternative fuel cars
0	£0	£0
1-50	£10	£0
51-75	£25	£15
76-90	£100	£90
91-100	£120	£110
101-110	£140	£130
111-130	£160	£150
131-150	£200	£190
151-170	£500	£490
171-190	£800	£790
191-225	£1,200	£1,190
226-255	£1,700	£1,690
More than 255	£2000	£1,990

So the above refers to the FIRST YEAR of ownership. After this you will pay a different rate depending on the car and fuel type. So, below, we have a short (perhaps sweet to some) table to demonstrate the charges from your SECOND YEAR.

Second Year Road Tax bands for cars registered After 1st April 2017

Fuel type	Cars costing less than £40,000	Cars costing more than £40,000
Petrol and Diesel	£140	£440
Alternative Fuel	£130	£450
Electric Car	£0	£310

Cars Registered Before Tax change on April 1st 2017

So, if you registered or are planning on registering your car before April 1st then you should be unaffected by the massive changes we’ve seen above. Below is a table demonstrating what you’d expect your first year tax to be

First Year Road Tax bands for cars registered Before 1st April 2017

CO2 emissions	Petrol and Diesel Cars	Alternative Fuel Cars
A- up to 100	£0	£0
B- 101 - 110	£0	£0
C- 111 - 120	£0	£0
D- 121 - 130	£0	£0
E- 131 - 140	£130	£120
F- 141 - 150	£145	£135
G- 151 - 165	£185	£175
H - 166 - 175	£300	£290
I - 176 - 185	£355	£345
J - 186 - 200	£500	£490
K - 201 - 225	£650	£640
L - 226 - 255	£885	£875
M - More than 255	£1,120	£1,110

And as for your second year and ongoing years of owning this particular car, you can expect the expected changes…

Second year onwards Road Tax bands for cars registered Before 1st April 2017

CO2 emissions	Petrol and Diesel Cars	Alternative Fuel Cars
A- up to 100	£0	£0
B- 101 - 110	£20	£10
C- 111 - 120	£30	£20
D- 121 - 130	£110	£100
E- 131 - 140	£130	£120
F- 141 - 150	£145	£135
G- 151 - 165	£185	£175
H - 166 - 175	£210	£200
I - 176 - 185	£230	£220
J - 186 - 200	£270	£260
K - 201 - 225	£295	£285
L - 226 - 255	£500	£490
M - More than 255	£515	£505

So, now you’ve got the numbers, dates, and figures let’s have a look at some of the questions you might still have.

Why?

Well, this is probably one of the main things you may be wondering… Why now? Why do it? Well, there’s a pretty basic answer to that, money. VED faced big changes 16 years ago, and these changes revolved around encouraging people to be more environmentally aware when purchasing vehicle. In 1960 the UK was producing 11 metric tonnes of CO2 per capita, by 2000 this figure was 9.23 and by 2016 it was 7.86. These figures give you an idea of how initiatives such as VED worked in making people more environmentally conscious. That being said, the initiative was driven by the fact that it was the higher emission vehicles that would be taxed and therefore make up for any deficit felt from encouraging the low emission purchases. Car companies have taken full advantage of this, making cars with low emission engines so they can ad low VED to the list of reasons to buy. More and more, due to technological advancement, the income that the government get from Road Tax has suffered and so… we get the changes of April 2017. There is simply not enough income from Road Tax as there are not as many high emitting cars on the roads.

What does it mean?

This basically means that MORE cars will be paying road tax, with a first year based on CO2 emissions and a basic rate starting at £140 after that. And this includes hybrid cars. The only cars that will be exempt from this will be fully electric cars. Cars costing more that £40,000 will incur an extra charge of £310 which means if you do get a premium model car you’ll be looking at a standard rate of around £450. Tax will no longer be transferable between owners, a ‘taxed till the end of the year’ is no longer a selling point. The old owner will be reimbursed for any outstanding tax and the new owner will have to get tax.

What to do Next?

We know this is a massive change and could be slightly confusing so, here at West Way, we have decided to put together some real life examples for you to have a look at.

Nissan Electric Car

The new Nissan LEAF is FULLY electric. This means no CO2 emissions and costs under £40,000.

VED cost: £0

Petrol / Diesel under £40,000

CO2 emissions are low on the 2017 Micra and it costs under £40,000. This means a standard charge of £140 a year. As opposed to nothing for the first year and £20 a year thereafter… VED extra cost over 3 year: £380

Petrol / Diesel over £40,000

With emissions of 275g/km and costing over £40,000 you would be looking at the Nissan G-TR. Right now you’d be looking at £145 a year to tax and £435 over three years. BUT after April 1st 2017 you’d be looking at £200 in the first year and £450 a year thereafter.     VED extra cost over three years: £665 West Way hope that this has been useful for you! If you’re looking for any more info then why not head over to Government website for a more info.

 

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