Road tax – how does it works and how much does it cost?

Commonly referred to as road tax, Vehicle Excise Duty (VED) is levied on every vehicle that uses a UK public road, and it’s collected by the Driver and Vehicle Licensing Agency (DVLA).

For the majority of cars registered before April 2017, VED is mainly measured according to official CO2 emission figures. For vehicles registered after this date, payments are emission-related for the first year only. And for the second year, a £165 tariff applies to most drivers, irrespective of the CO2 emission levels a car produces.

As things stand, electric vehicle (EV) owners aren’t required to pay VED; plug-in hybrid electric vehicle (PHEV) owners typically pay a maximum £25 for the first year of registration; and diesel cars that meet the RDE2 standard and petrol cars could pay up to £2,365.

The aforementioned PHEV and HEV payments are a guide only – there are several VED tax bands, which are based on the emissions that vehicles produce. Full details can be found here: https://www.gov.uk/vehicle-tax-rate-tables.

Here at Birchwood Motor Group, we stock a wide selection of low and zero-emission vehicles produced by Ford, KIA, and ŠKODA. If you’d like to know more or if you wish to book a test drive, please get in touch with your local branch today.