Car tax (Vehicle Excise Duty) explained

First-year rates (cars registered from 1 April 2017)

The first payment, usually included in the price of a new car, depends on CO2 emissions. Rates below are for petrol, alternative fuel and RDE2-compliant diesel cars from 1 April 2026. Diesels not meeting RDE2 pay the next band up.

Standard rate and expensive car supplement

From the second year, cars registered since April 2017 pay the standard rate of £200 a year (£210 by 12 monthly Direct Debits; shorter instalments cost a little more). Electric cars pay the same standard rate.

Cars with a list price over £40,000 pay an extra £440 a year for 5 years from the second tax payment. For zero-emission cars the threshold is £50,000. So a £45,000 petrol car pays £640 a year in years 2 to 6, while a £45,000 EV pays £200.

Cars registered between March 2001 and March 2017 pay by CO2 band (A to M) and older cars by engine size; see the GOV.UK rate tables. From April 2028 the government plans an additional pay-per-mile charge for electric and plug-in hybrid cars.

How to cancel car tax and get a refund

You cannot cancel car tax on its own; it is cancelled automatically when you tell DVLA about a change. DVLA then refunds any full calendar months remaining, and cancels any Direct Debit.

• Sold or transferred the car: tell DVLA online using the 11-digit reference on the V5C. Tax does not transfer to the new keeper; they must tax it before driving.
• Scrapped: use an authorised treatment facility, which tells DVLA.
• Off the road: make a SORN (Statutory Off Road Notification). The car must then be kept off public roads.
• Exported, written off, stolen (after 1 month, when the insurer has paid out) or registered with a disability exemption.
• Refunds are paid by cheque to the name and address on the log book, usually within 6 weeks.

How to tax a car without a V5C

To tax online you need a reference number. You can use any of these:

• The 16-digit reference on a V11 tax reminder letter.
• The 12-digit reference on the green new keeper slip (V5C/2) if you have just bought the car.
• If you have none, apply for a new log book with form V62 (£25 fee) at a Post Office that deals with vehicle tax, and you can tax the vehicle at the same time.

Checking and paying

Use the free GOV.UK vehicle enquiry service to check whether any car is taxed, its tax due date and MOT status. Pay online, by phone or at a Post Office. You need valid insurance and MOT (where required) to tax. Driving untaxed can lead to a fine of up to £1,000 and clamping.

Cars registered between March 2001 and March 2017

These cars pay a yearly rate based on CO2 emissions, banded A to M. There is no expensive car supplement on these older cars, and the lowest bands pay very little.

Who pays nothing, or half

Exempt vehicles still have to be taxed each year, at £0. If you do not, DVLA treats the vehicle as untaxed.

• Vehicles made before 1 January 1986 are exempt as historic vehicles. You still have to tax them, at £0.
• People getting the higher rate mobility component of Disability Living Allowance or the enhanced rate mobility component of PIP can get full exemption on one vehicle.
• The standard rate mobility component of PIP or Adult Disability Payment gives a 50% reduction.
• Mobility scooters and powered wheelchairs are exempt if limited to 8mph on the road.

What it costs over 6 years: three cars compared

The first-year rate matters less than it looks. For expensive cars, the expensive car supplement in years 2 to 6 usually costs more.

Buying a used car: tax it before you drive

Vehicle tax is not transferred when a car is sold. The seller gets a refund, and you must tax the car before driving it away, even from a dealer's forecourt.

You can do this online straight away with the 12-digit reference from the green new keeper slip of the V5C. If the car was SORNed, it cannot go on a public road until it is taxed, except to drive to a pre-booked MOT.