Upcoming changes to Electric Vehicle Excise Duty (VED) from 1 April 2025

Registered keepers for fully electric vehicles, or battery electric vehicles (BEVs), across the UK will receive a letter from the DVLA letting them know that as of  1st April 2025, they will need to pay Vehicle Excise Duty (VED) for the first time. Owners of hybrid cars, which typically are classed as low-emission cars, already pay the appropriate vehicle tax.

Currently, VED is free for BEVs, so the new 2025 rules will impact hundreds of thousands of BEV owners who have bought their cars in recent years. However, this is not the only change; an expensive car tax supplement will also be introduced for BEVs with a list price that exceeds £40,000.

The Vehicle Excise Duty changes

• Electric and low-emission cars registered on or after 1 April 2025: The registered keeper must pay the lowest first-year VED (which applies to vehicles with CO2 emissions of 1 to 50g/km). From the second tax payment onwards, these vehicles will pay the standard rate. This is £190 for 2024 but is subject to change for 2025.
• Electric and low-emission cars registered between 1 April 2017 and 31 March 2025: The registered keeper will pay the standard rate. This is £190 for 2024 but is subject to change for 2025.
• Electric and low-emission cars registered between 1 March 2001 and 31 March 2017: These vehicles will move to the first band with a VED value. This is £20 for 2024 but is subject to change for 2025.
• Hybrid and alternatively fuelled vehicles (AFVs): The £10 annual discount for hybrid and AFVs will be removed, and the rate to be paid will depend on when the vehicle was first registered.
• Electric vans: Most electric vans will move to the standard annual rate for light goods vehicles. Check the current rates for this vehicle.
• Electric motorcycles: These will move to the annual rate for the smallest engine size. Check the current rates for this vehicle.

The DVLA will send the registered keeper a reminder before the time from which their BEV needs to be taxed. The VED can be paid online, by phone, or at a Post office.

The expensive car supplement

Under the Expensive Car Supplement, cars that cost over £40,000 when new pay an additional £410 annually for five years, starting from the first VED payment made when the car is a year old. For BEVs, it means that in addition to the annual £190 outlined above, the vehicle keeper will pay another £410. (This figure is subject to change for 2025).

The net result is that the total road tax for any BEV costing over £40,000 is £600, paid yearly until the car is six years old. The £40,000 figure includes optional extras and is based on the manufacturer’s official list price of the car, not the purchase price actually paid by the customer. 

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