UK Road Tax Rates 2025: Everything You Need to Know

Driving Smart, Paying Less: The Latest on UK Vehicle Tax and Low Car Tax Vehicles

Published: 13 May 2025

Keeping up-to-date with the latest car tax rules can sometimes feel like navigating a maze. If you’re a driver in the UK, at Wilsons Epsom, we’re here to help you understand the changes to your road tax from April 2025. This guide covers everything you need to know about the new Vehicle Excise Duty (VED) rates for new cars and older models too.

The recent changes to road tax have significant implications for all UK drivers, especially those considering electric vehicles or low-emission options. If you’re in the market for a new or used car, we’ll also highlight the top 8 cars with the lowest road tax rates in 2025. Read on to find out more…

Key Takeaways:

  • Electric cars are no longer tax-exempt! From 1st April 2025, EV drivers will pay £10 in the first year and £195 each year after.
  • VED rates in the first year have doubled for most combustion engine vehicles, with the most polluting cars now facing up to £5,490 a year.
  • The expensive car supplement has increased to £425 per year and now applies to electric vehicles worth over £40,000.
  • Classic cars over 40 years old remain exempt from road tax.
  • Low-emission vehicles (such as hybrids) still offer substantial tax savings compared to petrol and diesel alternatives.

How Much Will My Car Tax Cost in 2025?

The amount of road tax you'll pay in 2025 will depend on the make and model of your vehicle, when your vehicle was first registered, its CO2 emissions, and how much it is worth when new. Here’s what you need to know:

For New Cars Registered From 1st April 2025:

First Year Road Tax Rates:

  • Zero-emission vehicles (EVs) are £10
  • Low emission vehicles (1-50g/km CO2) are £110
  • Medium emission vehicles (51-75g/km CO2) are £130
  • All other bands (76g/km and above): To calculate the cost, you’ll need to double the previous rates you were paying, so expect to pay between £190 to £5,490 for the most polluting vehicles.

Standard Road Tax Rate (Second Year Onwards):

  • All vehicles pay £195 per year
  • Cars with a list price over £40,000 when new will pay an additional £425 per year for five years (this totals £620 annually)

For Cars Registered Between 1st April 2017 and 31st March 2025:

  • A standard road tax rate of £195 now applies to all vehicles, including electric cars
  • An expensive car supplement of £425 applies to vehicles with a list price over £40,000 when new (except electric vehicles registered before 1st April 2025)

For Cars Registered Between 1st March 2001 and 31st April 2017:

  • Road tax bands are based on CO2 emissions, ranging from £20 for the lowest band (previously tax-free) to £695 each year for the highest polluters
  • Alternative fuel cars no longer receive a £10 discount on road tax

For Cars Registered Before March 2001:

  • The road tax rate is based on engine size
  • Engines under 1549cc will pay £220 per year
  • Engines over 1549cc will pay £360 per year

Will All Electric Cars Pay Road Tax in 2025?

The perks of tax-free electric motoring are coming to an end. From 1st April 2025, all newly registered electric vehicles will be subject to vehicle excise duty (VED). Despite this, the road tax rates for EVs still remain favourable compared to cars with petrol or diesel engines:

To clarify, the road tax rates for electric cars from April 2025 are:

  • First-year rate: £10 (the lowest band available)
  • Standard rate from the second year: £195
  • Expensive car supplement is an additional £425 per year for EVs worth over £40,000 registered after 1st April 2025

For electric cars registered between 1st April 2017 and 31st March 2025, the standard rate of £195 will apply, but these vehicles remain exempt from the expensive car supplement.

If you’re in doubt as to whether an electric car is still cost-effective for you, remember that EVs benefit from lower running costs, including recharging and maintenance.

Will Classic Cars Have to Pay Road Tax in 2025?

There’s good news for vintage car enthusiasts, as classic cars that are over 40 years old remain exempt from Vehicle Excise Duty (VED). This means that in 2025, cars manufactured in 1985 will become tax-exempt - great news if you own a car from this year! However, to qualify for this special road tax exemption, owners must apply specifically for the "historic vehicle" tax class from the DVLA.

This rolling 40-year exemption continues each year, so vehicles from 1986 will become exempt in 2026, and so on. If you own a classic car approaching the 40-year mark, this could mean you make significant savings in the near future!

Top 8 Low Car Tax Vehicles at Wilsons Epsom

Popular cars with low road tax rates in 2025:

  1. Citroen C3
  2. Fiat 500 Electric
  3. MG HS
  4. Nissan Ariya
  5. Nissan Qashqai
  6. Peugeot 3008
  7. Renault Captur Plug-in Hybrid
  8. Renault Clio

Citroen C3

Road Tax Rate 2025: Expect to pay the standard £195 rate for new models (registered after 1st April 2017)

The Citroen C3 certainly stands out with its distinctive design and exceptional comfort, thanks to the Advanced Comfort suspension system. Its frugal three-cylinder petrol engines deliver over 50mpg while keeping CO2 emissions lower than many rivals, placing it in much more favourable tax bands.

Why We Love the Citroen C3:

The C3's unique "Airbump" door panels help prevent parking damage, while the surprisingly spacious cabin offers ample headroom and practical storage solutions. We think it’s a pretty smart choice for budget-conscious families looking for a car with both style and substance.

Fiat 500 Electric

Road Tax Rate 2025: Expect to pay £10 for the first year, then £195 standard rate from the second year onwards

The stylish Fiat 500 Electric car perfectly blends Italian design flair with zero emissions, qualifying for the lowest possible first-year tax rate of just £10. With its nippy urban performance and tight turning circle, it excels as a city runaround while providing approximately 199 miles of range on a single charge in long-range versions.

Why We Love the Fiat 500 Electric:

The 500’s interior features sustainable materials and modern tech, making it as appealing inside as it is on the outside. Being a fully electric car means cheaper running costs beyond just the tax advantages, with significantly lower "fuel" bills compared to petrol versions.

MG HS

Road Tax Rate 2025: Expect to pay the standard £195 rate for new models (registered after 1st April 2017)

Offering incredible value for money, the MG HS boasts efficient powertrains that help keep running costs and tax payments lower than you might first expect. The plug-in hybrid variant even offers 32 miles of electric-only range and qualifies for a significantly lower first-year tax rate than the petrol-only versions.

Why We Love the MG HS:

With its 5-star Euro NCAP safety rating, comprehensive 7-year warranty, and premium-feeling interior materials, the HS challenges more expensive SUVs while keeping running costs sensible for budget-conscious families seeking maximum car benefits for minimal outlay.

Peugeot 3008

Road Tax Rate 2025: Expect to pay the standard £195 rate for new models (registered after 1st April 2017 - depending on the specific model)

The striking Peugeot 3008 combines bold styling with impressive tax efficiency, particularly in its plug-in hybrid variant, which qualifies for the advantageous £110 first-year road tax rate. The award-winning i-Cockpit interior with its distinctive small steering wheel and high-mounted digital instruments creates a unique driving position that's super comfortable.

Why We Love the Peugeot 3008:

With up to 55 miles of electric-only range in the PHEV models and fuel economy reaching an impressive 356.2mpg in ideal driving conditions, the 3008 offers premium SUV appeal with remarkably low running costs. It’s a tick in the box from us!

Renault Captur Plug-in Hybrid

Road Tax Rate 2025: Expect to pay £110 for the first year, then £195 standard rate from the second year onwards

With its plug-in hybrid powertrain offering up to 30 miles of electric-only range, the Renault Captur PHEV falls into the preferential £110 first-year tax band. The versatile interior features sliding rear seats that can expand boot space from 484 to 616 litres, (great for family life), making it one of the most practical small SUVs available.

Why We Love the Renault Captur Plug-in Hybrid:

The smooth transition between electric and petrol power means that the Renault Captur Plug-in Hybrid provides a refined all-around driving experience. You can expect to achieve an impressive fuel economy of almost 200mpg – perfect for drivers wanting the practicality of an SUV with minimal running costs.

Renault Clio

Road Tax Rate 2025: Expect to pay the standard £195 rate for new models (registered after 1st April 2017)

The popular Renault Clio combines classic French style with practical efficiency, ensuring lower first-year tax rates compared to many competitors in its class. Its range of economical engines includes a hybrid option that significantly reduces emissions and improves fuel economy to around 64mpg, placing it in lower road tax rate brackets.

Why We Love the Renault Clio:

Thanks to the comprehensive suite of safety features, the Renault Clio earns a desirable 5-star Euro NCAP rating. We also like the well-designed interior cabin, which boasts technology usually found in larger, more expensive vehicles.

Drive Smart with Wilsons Epsom

When choosing your next vehicle, the cost of car tax can prove an important point to consider when weighing up the overall running costs. Here at Wilsons Epsom, our expert team can help you navigate the new tax landscape and find the perfect low-tax vehicle to suit your needs and budget.

Visit our multi-franchise showroom in Surrey today to explore our range of tax-efficient models. Drive smart, pay less with Wilsons Epsom!

Note: All road tax rates are correct as of April 2025. For the most up-to-date information on your specific vehicle, click here for the official DVLA guide, consult the official government website or speak to our team.

Frequently Asked Questions About Road Tax:

How can I check my vehicle's road tax rate?

You can check your specific vehicle's road tax rate on the UK government website by entering your registration number or by using online tax calculators that factor in your car's age, emissions, and value.

Can I pay my car tax monthly?

Yes, you can pay your vehicle tax annually, every six months, or monthly by Direct Debit. However, paying in instalments rather than one upfront cost will result in a slightly higher cost (around 5%)

What happens if I don't pay my car tax?

Driving without having valid vehicle tax is illegal and can result in a fine of up to £1,000. Your vehicle may also be clamped or impounded, incurring additional costs for the release of your vehicle.

Does road tax transfer when I sell my car?

Unfortunately, road tax no longer transfers with vehicle ownership. The seller can claim a refund for any full months of remaining tax, while the buyer must pay to tax on the vehicle before driving it.

How is the £40,000 expensive car threshold calculated?

The £40,000 threshold includes the vehicle's list price when new, including any factory-fitted options, accessories, and VAT, but excludes the first year's road tax and registration fee.