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2018 UK road tax bands: what’s it going to cost?

Published: 16 August 2018

► Updated car tax for new models
► How vehicle excise duty (VED) works
► The UK's new road and car tax bands explained

If you’re looking to get a new car this year, your annual road tax bill could skyrocket from £0 to as much as £450 per year. Worse still, that’s even if you go for a new version of the same car. So what’s going on?

The Government has introduced new road tax bands, ditching the previous set of car tax bands for new cars – where charges were directly linked to CO2 emissions. Instead, the tax bands now comprise of a three level set-up, as well as a new system in which first-year tax rates are split into 13 bands depending upon your vehicle’s CO2 emissions.

So how much will you pay, and how will the new tax bands treat your current car – or a new one? Keep reading for CAR’s guide to the 2018 UK road tax bands.


2018 car tax bands: what will I have to pay?

Sub-£40,000 zero-emission models will cost you nothing in tax – as with the previous road tax system – though those over £40k will be slapped with a £310 surcharge for the first five years. That means a total bill of £1550 before dropping to £0 from year six onwards.

Don't forget, if you're not going to use your car for a while (maybe you've been posted abroad or you own a classic and want to mothball it over winter), you should apply for a Statutory Off Road Notification (SORN), waiving your road tax bill for a set period.

What is a SORN? And how it works

Meanwhile, petrol and diesel models will be charged £140 per year – bar hybrids and alternative fuel models, which are charged £130 – with a first-year charge based on the car’s CO2 emissions. As with electric cars, there’s a £310-per-year surcharge for models that break through the £40,000 mark for the first five years.

Models that come in under 50g/km will cost just £10 in the first year, rising to £2000 for cars pumping out more than 255g/km. As with the standard road tax charge, £10 is cut from the annual bill for alternative fuel models – including hybrids, bioethanol and LPG-powered machines.

2018 road tax bands: Vehicle Excise Duty from 1 April 2017

Emissions (CO2 g/km)

First-year rate

Standard rate

0

£0

£0*

1-50

£10

£140*

51-75

£25

£140*

76-90

£100

£140*

91-100

£120

£140*

101-110

£140

£140*

111-130

£160

£140*

131-150

£200

£140*

151-170

£500

£140*

171-190

£800

£140*

191-225

£1200

£140*

226-255

£1700

£140*

over 255

£2000

£140*

* Cars over £40,000 pay an annual £310 supplement for 5 years

Vehicles built and purchased before 1 April 2017 will not be affected by these rates.

Additional year 1 charge for diesels that don’t meet new emissions tests

Real-world emissions are now high on the Government’s agenda and chancellor Philip Hammond announced in the 2017 Budget a first-year hike for diesel cars that fail to meet the latest emission standards.

This means that new diesel cars that fail to meet newly introduced RDE2 emissions targets from April 2018 will see their road tax bumped up one band – adding up to £500 to the amount owners have to stump up.

These new tests aim to gauge real-world emissions, with high-emitting models penalised with additional levies over rival cars. Models built before 1 April 2018 will not be subject to this new charge, however, and road tax rates return to normal after the first year.

How new WLTP real-world emissions tests work 

Add too many options and your road tax charge could leap

Be aware, that it’s the list price that’s considered when slapping on the £310 surcharge – so if you go wild and add loads of options to a less pricey car, pushing it over the £40,000 mark, you’ll be liable for higher road tax costs.

The Government is continuing to offer Direct Debit and six-month options to make road tax more affordable, though you will have to pay a slight premium if you want to take advantage of these. 

UK car tax, road tax and VED explained

2018 road tax bands: which used cars are affected? 

The new bands apply to new cars registered since 1 April 2017, therefore these will cover a vast majority of 17-plate models and all 67-plate models that follow.

There will be some 17-plate models registered between 1 March and 1 April 2017, however, that come under the old rules. With these cars the lower the emissions, the lower the road tax charge. 

What about cars registered between 1 March 2001 and 31 March 2017?

Road tax is split across 13 bands for models registered between March 2001 and March 2017. This varies from as little as £0 for models with sub-100g/km CO2 emissions to £535 for those kicking out 255g/km or more. 

Costs for alternative-fuel models are £10-per-year less, starting at £0 for sub-100g/km models rising to £525 for those emitting more than 255g/km.

Cars registered before 23 March 2006, meanwhile, are capped to a maximum of £305 – regardless of how polluting they are. Therefore, if you’re after an over-engined monster that belches out CO2 by the bucket load and was on sale over 2005 and 2006, going for a pre-March 2006 car could save you £230 per year in tax.

My car was registered before March 2001: how much do I have to pay?

Just two bands apply to pre-2001 models. If the engine size exceeds 1549cc you’ll have to stump up £245 every year, while those with a smaller engine are charged £150.

As with the other systems, Direct Debit and six-month options are available, providing a lower cost – though these will cost you more overall than simply paying for a whole year upfront.

VED: which cars are free to tax?

Go for a sub-£40,000 electric car registered after 1 April 2017 and you won’t have to open your wallet when renewal time comes.

You get much more choice of cars if you pick one registered between March 2001 and 2017 – anything that emits less than 100g/km won’t cost you a penny in road tax. 

And if you’re open to driving a much older car, vehicles that are more than 40 years old are exempt from paying road tax full stop. So if you fancy tooling around in an MGB GT, Merc SL or VW Beetle, step this way.

 If you’re on a budget, similar age cars that emit up to 120g/km will only cost you £20 per year in VED, so may also be worth considering.

By CAR's road test team

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