Older Drivers Car Tax Changes in the UK: What You Need To Know

From 1 April 2025, the UK government has implemented sweeping changes to Vehicle Excise Duty (VED) that impact drivers of all ages—but particularly older motorists, whose long-held assumptions about annual tax bills may be upended.



What’s New for Older Drivers?



1. Inflation-Linked VED Increases All vehicles now see their tax calculated in line with Retail Price Index inflation . Many older cars registered before 2017 will face higher annual rates determined by CO₂ emissions.



2. New Tiered Rates for Cars Pre‑2017 Cars registered between 1 March 2001 and 31 March 2017 are taxed across emissions bands. Effective April 2025, even low‑emission models (CO₂ ≤100 g/km) now incur a £20 annual charge. Previously, these vehicles were exempt.



3. Legacy Engine-Size Bands Remain For pre‑2001 cars taxed by engine size:




Under 1549 cc now pay £220



Over 1549 cc pay £360




4. EV and Hybrid Parity Electric and hybrid vehicles (EVs and PHEVs) lose their zero‑tax status. From April 2025:




EVs registered before April 2017: £20/year



EVs registered post‑2017: £195/year



First-year new EVs: £10, rising to £195 from year two




5. ‘Expensive Car’ Supplement Reintroduced Cars (including EVs) with a new list price over £40,000 now incur a £425/year surcharge from years two to six—ending the previous EV exemption.



Why This Matters for Older Drivers




Classic or low-mileage older cars —once tax-exempt—must now contribute via VED, even if they’re eco-conscious.



Long-time EV drivers lose the perk of zero road tax; their annual bills will rise.



Owners of high-value used vehicles built before 2017 might unexpectedly trigger the expensive car supplement.




In short, many owners once paying little or nothing in road tax could suddenly face higher costs.







Summary Table: Selected Typical VED Costs











Quick Takeaways




If you drive an older vehicle, your VED is likely going up—even if your car is low-emission or electric.



EVs are no longer road-tax-free.



High-value vehicles now trigger an additional surcharge.



Use the DVLA tool to check your exact obligation—and act early if you want to avoid surprise costs.








FAQ: Older Drivers Car Tax Changes



Q: Are historic/classic cars still exempt? A: Yes. Cars over 40 years old (built before 1985) remain fully exempt from VED and the expensive car supplement.



Q: I drive a low‑emission older car (≤100 g/km CO₂). Do I pay more? A: Yes. From April 2025, even these cars face a flat £20 annual road tax; previously they were exempt.



Q: Why are EV owners losing their tax exemption? A: The government aims to broaden the tax base, supporting road funding. With growing EV adoption, scrapping exemptions helps maintain fairness and revenue.



Q: Will first-year VED rates rise for older drivers buying new cars? A: Yes. Petrol, diesel, hybrid, and EV purchases from April 2025 face higher first-year emissions-based VED. EVs pay £10 in year one.



Q: Does the £425 expensive car supplement affect used cars? A: Only if the car’s original list price exceeded £40,000 and it’s within years 2–6 post-registration. Inflation and EV inclusion widen the number of affected vehicles.



Q: Can I delay the new tax changes? A: No. VED rates are applied based on the next renewal; early renewals don’t postpone changes. Use DVLA’s tool for clarity.







Final Word



The April 2025 older drivers car tax changes represent a major reshaping of the road tax landscape.



Even historically exempt or low‑emission vehicles will now contribute, while EVs and high‑value models lose previous benefits and exemptions.



Familiarising yourself with the new bands and checking your specific rate before renewal is crucial to avoiding unexpected costs.



If these changes affect you, now’s the time to act.
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