How UK car tax (VED) works in 2026/27

There are three everyday systems for cars. First registered on or after 1 April 2017: a first-year rate from a CO₂ table, then a flat standard rate, plus a five-year supplement for some expensive cars. First registered from 1 March 2001 to 31 March 2017: you stay on the older graduated CO₂ bands A–M for every renewal. First registered before 1 March 2001: engine size only — not over 1,549 cc versus over.

The same 120 g/km petrol can therefore be three different bills. On the 2017-on system it is a first-year band (currently £455) and then £200 a year. On the 2001–2017 system 120 g/km is Band C at £35. On a 1998 car the CO₂ figure is ignored and a 1,600 cc engine is £375.

When a car is first registered you pay a ‘showroom’ rate for 12 months from its CO₂. Petrol, RDE2 diesel, hybrids and zero-emission cars share one column; diesel that does not meet Real Driving Emissions 2 uses the higher column. Most newer diesels meet RDE2 — ask the manufacturer if the V5C is unclear.

From the second tax payment the standard rate applies. For 2026/27 that is £200 whether the car is petrol, diesel, hybrid or electric. The old £10 alternative-fuel discount has gone. Six-month tax is 55% of the 12-month rate (£110 if the year is £200), not half. Direct Debit can cost a little more still.

If the published list price when the car was first registered is over £40,000 (petrol, diesel or hybrid) you pay an extra £440 a year for five years, starting at the second tax payment — £640 in total in 2026/27. Electric and other zero-emission cars use a £50,000 threshold, and only if they were first registered on or after 1 April 2025. A zero-emission car registered before that date does not pick up the supplement even if it was expensive when new.

List price is the published price before dealer discounts, not the used price on Auto Trader. It should be on the V5C or available from the selling dealer. The five-year clock starts at the second licence, not the day you buy the car privately — a three-year-old expensive car may only have a couple of supplement years left.

A new zero-emission car first registered from 1 April 2025 pays £10 for the first year, then the £200 standard rate. EVs first registered between 1 April 2017 and 31 March 2025 pay £200 on renewal (there is no first-year rate still sitting on those cars). Older EVs on the 2001–2017 system pay the low graduated band — typically £20 for 0–100 g/km.

From April 2028 the government has announced a separate pay-per-mile charge (eVED) for electric and plug-in hybrid cars, on top of VED. Our calculator does not model that 2028 charge. Budget the £200 (or £640) VED you can see today, and treat eVED as a future extra.

The registration certificate lists the date of first registration, fuel type, CO₂ (g/km) and, for newer cars, information you can match to list price. That is the input set our calculator needs. We do not look up a number plate, because a public plate search is the official vehicle enquiry service’s job — taxed or untaxed status, not a planning estimate.

To tax the car you generally need insurance and, if it is old enough, a valid MOT. Tax does not transfer when you sell: the new keeper taxes it, and the seller can claim a refund for full remaining months. Historic vehicles manufactured more than 40 years before 1 January of the current year (for 2026, generally before 1 January 1986) can be in the historic class if you apply — manufacture year, not just the registration date.

VED is a yearly (or six-monthly) standing cost. Fuel is the usage cost. A cheap-to-tax older petrol can still be expensive to run at 35 mpg; a new EV has a small first-year VED bill and a different energy cost. Pair this guide with the fuel-cost calculator if you are comparing two cars on a commute, and with the loan-repayment calculator if you are financing the purchase.

Company-car benefit-in-kind is a separate Income Tax charge on the driver. It is not VED. Do not add our car-tax result onto a P11D calculation unless you know you also pay the vehicle tax personally.