Do electric cars pay road tax now?
Yes. The long-standing VED exemption for electric cars ended on 1 April 2025. From that date every EV pays Vehicle Excise Duty, the tax most people call road tax. The amounts are modest: a token £10 in the first year for a new car, then the standard £200 a year. The one sting is for expensive models, which now also pay a yearly supplement. The calculator below gives your exact figure.
What road tax will your EV pay?
Tell us when it was registered and its list price. We show the first-year rate, the standard yearly rate, and the expensive-car supplement if it applies.
Annual road tax (VED) now
£
Rates for 2026/27. The supplement applies in years 2 to 6 only. Confirm current rates on GOV.UK.
VED reform took effect 1 April 2025; EV expensive-car threshold raised to £50,000 (November 2025 Budget). Standard rate £200, supplement £440 for 2026/27. Source: GOV.UK.
The belief that is now out of date
For years, "electric cars are tax-free" was true, and it became one of the most repeated facts about EVs. That is exactly why it is now a trap: the exemption ended in April 2025, but the belief lingers in older guides, forum posts and sales patter. A buyer who assumes zero road tax in 2026 is simply working from a rule that no longer exists.
The amounts are not large, but the surprise is real, especially the expensive-car supplement, which can add £440 a year to a premium EV that the owner expected to tax for nothing. Knowing the current rules stops a small, avoidable shock.
How EV road tax actually works in 2026
VED for an electric car now depends on one thing above all: when it was first registered. There are three groups:
- 1.New EVs, from 1 April 2025: a £10 first-year rate, then the standard £200 a year. If the list price is over £50,000, add a £440 supplement in years 2 to 6.
- 2.EVs registered April 2017 to March 2025: moved onto the standard £200 a year from their first renewal after April 2025. No expensive-car supplement (they were exempt when registered).
- 3.EVs registered before April 2017: sit in a low band of around £20 a year.
Note the EV-only detail: the expensive-car supplement threshold is £50,000 for electric cars, not the £40,000 that applies to petrol and diesel. That higher threshold was set in the November 2025 Budget to soften the change for EV buyers, and it means most mainstream electric cars stay clear of the supplement entirely.
The insider view: VED is the wrong tax to watch
Here is what the road-tax headlines miss. For most drivers, VED is a rounding error next to the tax that actually decides EV economics: company-car Benefit-in-Kind. If you can get an EV through work, especially via salary sacrifice, the tax saving dwarfs anything VED does.
| Tax year | Electric car BiK | Typical petrol car BiK |
|---|---|---|
| 2025/26 | 3% | 25 to 37% |
| 2026/27 | 4% | 25 to 37% |
| 2027/28 | 5% | 25 to 37% |
The number that dwarfs VED Take a £40,000 company car and a 40% taxpayer. The EV is taxed on 4% of list price, so £40,000 × 4% × 40% = about £640 a year. An equivalent petrol car at 30% BiK costs £40,000 × 30% × 40% = £4,800 a year. The EV driver saves over £4,000 a year in company-car tax alone. That gap, not the £200 of VED, is the real reason EV uptake is driven by business and salary-sacrifice buyers.
The strategic point: if the EV decision is even partly a tax decision, the lever is BiK, not VED. A private buyer paying £200 of road tax and a company-car driver saving £4,000 of BiK are looking at completely different numbers for the same vehicle.
What it means for your wallet
For a private buyer, the practical change is small: budget £200 a year for road tax on most EVs, or about £640 if the car cost over £50,000 and is in its supplement years. That is new money compared with the old exemption, but still modest against fuel and insurance.
For anyone with access to a company-car or salary-sacrifice scheme, the maths is transformed. The BiK gap can be worth several thousand pounds a year, which often makes a brand-new EV cheaper in take-home terms than keeping an older petrol car. The tax change that grabbed headlines (VED) is the one that barely matters; the one that quietly persists (BiK) is the one worth acting on.
What to actually do
Budget £200 a year, not £0
The exemption is gone. Factor the standard rate into running costs so it is not a surprise at renewal.
Watch the £50,000 line
If you are buying a premium EV, staying just under the £50,000 list price avoids £440 a year for five years, £2,200 in total.
Ask about salary sacrifice
If your employer offers it, an EV on salary sacrifice at 4% BiK is the single biggest car-tax saving available in the UK right now.
Check your registration date
It decides your band. Older pre-2017 EVs pay only about £20 a year, a detail worth knowing for a used buy.
The bottom line
Electric cars are no longer tax-free: from April 2025 they pay £10 in year one then £200 a year, with a £440 supplement on models over £50,000. But VED was never where the real EV tax advantage lived. That sits in company-car BiK, where an EV is taxed at 4% against a petrol car's 25 to 37%, a gap worth thousands a year. Pay the modest road tax, avoid the £50,000 supplement if you can, and if a salary-sacrifice scheme is on offer, that is the lever worth pulling.
Electric car tax FAQ
The Selectra expert answers your questions
Yes. Since 1 April 2025, electric cars pay Vehicle Excise Duty (VED) like petrol and diesel cars, ending their previous exemption. A new EV pays a £10 first-year rate, then the standard £200 a year (2026/27). EVs registered between April 2017 and March 2025 also moved onto the £200 standard rate, and older EVs registered before April 2017 pay a low band of around £20. See GOV.UK.
It is an extra VED charge on cars with a list price above a threshold, paid each year from years 2 to 6. For petrol and diesel the threshold is £40,000, but for electric cars it was raised to £50,000 in the November 2025 Budget. An EV over £50,000 list price pays an extra £440 a year (2026/27) for five years, taking its annual VED to around £640. Below £50,000, no supplement applies.
This is where EVs still win big. Company-car Benefit-in-Kind (BiK) for a zero-emission car is just 4% of the list price in 2026/27 (rising 1 point a year to 5% in 2027/28), against 25 to 37% for an equivalent petrol car. On a £40,000 car, a 40% taxpayer pays around £640 a year for the EV versus £4,000 to £5,900 for the petrol. Via salary sacrifice the gap is larger still. This is the EV tax break that actually matters.
For most EVs, £200 a year. A brand-new EV pays £10 in its first year, then £200. If the list price is over £50,000 and it was registered on or after 1 April 2025, add the £440 expensive-car supplement in years 2 to 6 (about £640 a year in total). Use the calculator above for your exact figure.
Overall, yes, though the gap narrowed on VED. A petrol car pays a first-year rate based on CO2 that can run to several hundred or thousands of pounds, then the same £200 standard rate. On VED alone the two are now close. But once you add company-car BiK (4% vs 25 to 37%) and the far lower running and fuel costs, the EV remains comfortably cheaper to own and run.