2017 VED road tax all you need to know
You may be aware that as part of the 2015 budget, an announcement was made that there will be changes to the current road tax system, with a new payment structure coming into place in April 2017.
What are the new changes?
The new tax rule means that any new vehicle purchased after the 1st of April 2017 will be charged a variable amount for the first year, based on the CO2 emissions they produce.
After the first year, an annual cost of £140 will occur. Zero-emissions vehicles will remain exempt from any road tax costs, whilst those who choose to purchase a more luxurious vehicle (costing more than £40,000) will pay an additional £310 for the first 5 years of ownership.
(See breakdown below)
Who do these changes affect?
These changes will only effect new vehicles purchased after the 1st April 2017; vehicles registered before the 31st March 2017 will not be affected and will adhere to the current (more beneficial) tax structure.
Can vehicle tax be transferred if I choose to sell?
No, unfortunately not. The new system means that the seller is entitled to be reimbursed for any outstanding tax, whilst the buyer will need to re-tax the vehicle in their name.
When's the best time to buy?
If you're weighing up buying a new vehicle, it will be more cost-efficient to purchase your new set of wheels before the changes come into place.
As a brief comparison: for a vehicle that costs less than £40,000 and emits 120 g/km CO2, on the new structure, tax will cost £720 over 5 years of ownership, compared to £120 on the current structure.
|CO2 Emissions (g/km)||First Year Rate||Standard Rate|
|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||£1,200||£140|
|226 - 255||£1,700||£140|
Vehicles costing above £40,000 will pay an additional £310 for the first 5 years of ownership