car tax: what you need to know

car tax: what you need to know

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Car tax, also known as Vehicle Excise Duty (VED), is the annual premium you pay to the government to drive in the UK legally. It is a requisite for anyone who operates a vehicle on the country’s roads, and without it, you run the risk of a hefty fine and possible points on your license. In this article, we will guide you through how to work out your tax band and the best way to go about securing it.

How much is tax on my car?

The price you pay will depend entirely on which tax band your car falls under, which you can find out from the Gov.uk website.

Vehicle tax rates for cars registered after March 2001 are separated into 50 bands that are based on several elements, including engine size, fuel type, and CO2 emissions. Cars registered after March 2001 and before April 2017 will sit within one of 13 bands based only on CO2 emissions - therefore, if your vehicle has emissions below 100g/km, you won’t need to pay road tax. 

Are car tax rates changing?

Tax rates have changed in 2020 to reflect the improved emission tests. These tests now sit in line with what is known as WLTP - Worldwide Harmonised Light Vehicle Test Procedure - which is based on more realistic conditions than the previous testing standard. The tests now take into account the difference between driving in suburban and urban areas, longer distances, higher average and max speeds, and more realistic driving behaviour.

Due to the more rigorous nature of the test, higher emissions will be recorded. This means that all VED rates will need to be reassessed, and drivers of petrol and diesel cars will have to pay a higher amount.

Tax rates last changed in April 2017, with VED being calculated purely on a vehicle’s carbon dioxide emissions. Only cars with 0g/km CO2 emissions will be exempt from paying. The reason for this change is down to the large amount of CO2 still being emitted from the country’s cars. 

How do I get road tax on my car?

In order to secure tax on your car, van, or motorbike, you need to use a reference number from relevant documents that collate with your vehicle. You can use your V5C (vehicle log book), the green slip from the logbook of a recently purchased car, or a V11 reminder from the DVLA.

You can pay for your car tax via the Gov.uk website, or at a Post Office, that deals with vehicle tax. Some vehicles are exempt from having to pay for tax, but they must still be registered and taxed by law.

Can I tax my car over the phone?

If you want to, you can pay for your car tax over the phone with the DVLA, call 0300 123 4321 and have the relevant documents to hand.

Can I tax my car online?

Yes if you have the V11 reminder you can tax your car at https://vehicletax.service.gov.uk/

How do I get free car tax?

If you want a car that you do not need to tax, it needs to release zero CO2 emissions into the atmosphere, such as an electric car like the Renault Zoe, Nissan Leaf, or the BMW i3.

Disabled drivers can also apply for an exemption if they have the following:

  • The higher rate mobility component of DLA 
  • The enhanced rate mobility component of PIP 
  • War Pensioner’s Mobility Support
  • Armed Forces Independence Payment (AFIP)

Many blue badge holders will be exempt as well, so it is important to check what you are entitled to before you make a payment - although you will be able to get a refund if necessary.

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