Confused about tax when it comes to your electric car? Our guide covers everything you need to know about road tax and your electric vehicle.
Do electric cars pay road tax?
The government calculates Vehicle Excise Duty (VED), otherwise known as road tax or car tax, using a few factors:
- vehicle age
- the type of fuel
- CO2 emissions or engine size
- car price
- pollution levels
Check out the VED rate list on GOV.UK.
Currently, EVs are exempt from paying road tax.
Classic cars more than 40 years old, agricultural vehicles such as tractors, and vehicles used by disabled people are also exempt from paying road tax.
How long will EVs be tax-free?
From 2025, electric vehicles must pay road tax. The amount will depend on the car's age.
New EVs registered on or after 1 April 2025 will pay £10 in the first year, increasing to £165 from the second year onwards.
This rate will also apply to electric vehicles first registered after 1 April 2017.
Road tax for electric cars first registered between 1 March 2001 and 31 March 2017 is expected to be in the new 'Band B' rate, which is currently set at £20 per year.
Do you need to pay premium rate tax on EVs?
No.
But from April 2025, anyone buying a new car (electric or otherwise) that is priced over £40,000 will face £165 in tax.
As well as this, they’ll need to pay a £355 expensive car supplement, every year from the second to sixth year of registration.
From year seven, the annual tax drops to the standard rate (£165).
Tax for hybrid cars
If you have a hybrid car, or a plug-in hybrid (otherwise known as PHEVs), your tax requirements are slightly different to EVs.
This is because hybrid cars still use petrol or diesel and a small electric battery, leading to CO2 emissions.
Do hybrid car owners pay road tax?
Yes.
Hybrid cars must pay road tax, but they currently get a £10 discounted rate, compared to traditional full petrol or diesel cars.
Will hybrid road tax be changing?
From the 1st of April 2025, the £10 discount for hybrid cars will be removed and instead your tax will depend on when the vehicle was first registered.
If your hybrid car was registered before the 1st of April 2017, your road tax rate will depend on your vehicle’s CO2 emissions.
If it was registered after the 1st of April 2017, you’ll pay the standard rate of road tax. This is currently £190 but might change in 2025.
Is premium rate tax payable on hybrids?
Any hybrid with a list price of £40,000 or above must pay an additional premium rate road tax for five years (starting from the second time the vehicle is taxed).
How to pay road tax
There are different ways of paying your VED. Usually, people pay for their road tax online through GOV.UK website.
You can also do it over the phone, or even in your local post office.
All you need to get started is find your reference number in your vehicle logbook (V5C).
If you don’t have this reference number, you’ll need to apply for a new logbook.
Payment methods for road tax
You can make a lump sum payment or spread the cost of car tax by paying monthly or every six months via Direct Debit.
There’s a 5% surcharge if you pay monthly or every six months.
MOTs for electric vehicles
If you’re wondering about what kind of MOT your electric vehicle will need, and how much it may cost, check out our guide to MOTs for electric vehicles.
