UK EV Tax Changes 2026: What You Need To Know

What Changed in April 2025?

For years, electric vehicles in the UK were exempt from Vehicle Excise Duty (VED) — commonly known as road tax. That exemption ended in April 2025 as the government moved to close the growing tax gap caused by the rapid shift away from petrol and diesel vehicles.

Key changes at a glance

All EVs now pay VED from April 2025 — no exceptions
New EVs pay £10 in the first year (lowest first-year rate)
From year 2 onwards, the standard rate applies (£190/year in 2025)
EVs with a list price over £40,000 pay an additional £620/year premium supplement for years 2–6
Existing EVs (registered before April 2025) also now pay VED

How Much Will You Pay?

The actual VED cost depends on when your vehicle was registered and its original list price. Here's a breakdown by scenario.

EV registered before April 2025

Year 1 (2025–26): Standard rate applies — £190/year
If list price over £40,000: add £620 supplement = £810/year total
Supplement applies for years 2–6 from date of first registration

EV registered after April 2025

Year 1: £10 (lowest first-year CO₂ rate — 0g/km)
Year 2+: £190/year standard rate
If list price over £40,000: add £620 supplement for years 2–6

Still worth it?

Despite the new VED costs, EVs still save most UK drivers significantly on fuel. Average UK drivers doing 10,000 miles/year save approximately £1,400–£2,000 per year on fuel costs vs petrol equivalents — far outweighing the new VED expense.

What Does This Mean For Buyers?

For those considering buying an EV, the taxation change is unlikely to be a dealbreaker — but it does affect the total cost of ownership calculation. Budget for VED as a recurring annual cost, and factor the premium supplement into your decision if you are looking at vehicles over £40,000.

Practical checklist for EV buyers

Check the vehicle's original list price — above £40k triggers the supplement
Use MOTR to check tax status and due date for any used EV you're considering
Factor £190–£810 per year into your running cost estimate
Consider insurance group — EV insurance can be higher than petrol equivalents
Check public charging availability in your area before committing

Frequently Asked Questions

Do electric cars pay road tax in the UK now?

Yes. From April 2025, all electric vehicles registered in the UK are subject to Vehicle Excise Duty (VED). New EVs pay the lowest first-year rate, then the standard rate from year two.

How much road tax do I pay for an EV in 2025?

For new EVs registered after April 2025, the first-year VED rate is £10. From year two, EVs pay the standard annual rate of £190. EVs with a list price over £40,000 also pay the £620 premium supplement for years 2–6.

Are existing EV owners affected by the 2025 VED changes?

Yes. Existing EV owners began paying VED from April 2025, regardless of when their vehicle was registered. The rate depends on the registration date and list price of the vehicle.

How does this affect the cost of owning an EV?

For most EV owners, the VED cost adds £190–£810 per year depending on vehicle value. However, EVs still save significantly on fuel costs — average annual fuel savings over petrol remain £1,200–£2,000 depending on mileage.