Important changes to road tax that you need to be aware of

You may or may not be aware of the new changes to vehicle tax (VED) coming into effect on April 1st, but if you aren’t you should be. These changes can make a big difference to what you will pay if you purchase a new car from 1st April 2017 onwards. As this will only affect new purchases from that date, existing cars will see no change.

The new road tax regulations mean a higher tax rate for all new cars in the first year of registration, and a flat rate of £140 for most cars thereafter. Unlike the current system where low emission cars are tax exempt, the new system will only be free for vehicles with 0g/km. That means electric (the Nissan Leaf for example) and hydrogen cars only!

That's not all though - for cars costing more than £40,000 (of which there are, thankfully, none in the Suzuki, Nissan & Subaru range) there's a new five year supplement to pay which will be priced at £310 per year.

We’ve put together a table below to show the differences in car tax, between a car purchased on or before 31st March 2017, and from the 1st April 2017 onwards.

Model CO2 Emissions Current first year rate New first year rate 3 years @ current rate 3 years @ new rate % change over 3 years
Suzuki Celerio SZ3 1.0 99g/km £0 £120 £0 £400∞%
Nissan Qashqai 1.6 dCi (130) N-Connecta 115g/km £0 £160 £60 £440633%
Subaru Outback SE 2.5i Automatic 161g/km £185 £500 £555 £78040%
Nissan 370Z GT 3.7 245g/km £885 £1,700 £1,885 £1,9805%

The below tables show the existing tax rates, and what they will change to from 1st April.

Current (pre-April 2017) vehicle VED tax bands

VED Band CO2 Emissions Annual rate First year rate
A Up to 100 g/km £0 £0
B 101-110 g/km £20 £0
C 111-120 g/km £30 £0
D 121-130 g/km £110 £0
E 131-140 g/km £130 £130
F 141-150 g/km £145 £145
G 151-165 g/km £185 £185
H 166-175 g/km £210 £300
I 176-185 g/km £230 £355
J 186-200 g/km £270 £500
K 201-225 g/km £295 £650
L 226-255 g/km £500 £885
M Over 255 g/km £515 £1,120

VED tax bands: April 2017 onwards

CO2 Emissions (g/km of CO2) First year rate Standard rate
0 £0 £0
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
Over 255 £2,000 £140

Cars above £40,000 pay £310 annual supplement for five years

In an article on the VED tax change from AutoExpress, they stated:

“The 2017 changes will mean a car that is CO2 rated at 100g/km or lower – and thus free of road tax for life under the current VED band system - will cost its owner £400 over three years, £680 over 5 years, or a whopping £1,380 over ten years. If you can buy the same car before the April 1st deadline, you’d be mad not to.”

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