VED Car Tax Rates 2024/25

Confused about different rates of car tax and what you should be paying? Our guide explains everything while our car tax calculator eliminates the guesswork.

It's a common assumption that car tax — or Vehicle Excise Duty (VED for short) as it's officially known — as single rate of taxation. In reality, it's become more complicated than that over the past two decades.

While endeavours have been made to make the system fairer, because changes were introduced in phases the result is we now have have four types of taxation, each further broken down into bands.

For cars alone, there are different taxation methodologies for:

• Cars registered after 1 April 2017
• Cars registered between 1 March 2001 and 31 March 2017
• Cars registered between 1 January 1984 and 28 February 2001
• Classics cars registered before 1 January 1984

Not only will this guide illustrate the different costs within each car tax system, our handy calculator below will caculate the cost from your car's registration number.

Premium car tax for models with a list price of £40,000 or over

Effective from 1 April 2024, these are the current 2024/2025 car tax rates, applicable from the second to sixth year of taxation.

Fuel type	Annual rate*
Petrol or diesel	£600
Electric	£0
Alternative fuel cars	£590

Crucially, this taxation rate is based on the car's list price, including optional extras, the day before it was first registered.

*The Annual rate figure is inclusive of the Standard rate of car tax

Do I pay car tax on an electric model?

Electric cars qualify for free car tax but this will change on 1 April 2025 when they will be subjected to the Standard rate charge.

The exemption from the Premium rate will also end at the same time. This means electric cars with a list price of £40,000 or more will be charged an extra £410 (at present levels) per year for VED.

The new car tax rules will also affect petrol and diesel cars registered between 1 March 2001 and 31 March 2017.

All cars currently in Band A, which emit less than 100g/km of CO2, will be moved into Band B on 1 April 2025 — a move that will see millions of cars charged VED car tax for the first time.

The car tax discount for hybrid cars and other alternative fuels will also end in 2025.

Car tax for models registered between 2001 and 2017

If your car was registered between 1 March 2001 and 31 March 2017, you pay VED car tax based solely on its CO2 emissions.

This is a more complex system than the ones before and after it. During its lifespan, this road tax system was modified under several governments. You will need to know your car's CO2 emissions in order to calculate its road tax or you can use the calculator above.

It did, however, create several opportunities for car owners to pay zero or very little road tax. As car manufacturers learned to take advantage of the system, more cars fell into lower bands and this ultimately led to its abolition. 

Car tax for models registered between 1984 and 2001

The system for cars registered between 1 January 1984 and 28 February 2001 is based exclusively on engine size. It's simple to understand with just two rates — one for those of 1549cc and below, the other for models of 1550cc and above.

Note that models registered before 1 January 1984 are exempt from paying car tax.

Car tax for classic models over 40 years old

If there's any good news to be had regarding VED car tax it's that classic models first registered at least 40 years ago are exempt from paying it.

At the start of each year, on a rolling basis, the latest possible first registration date to qualify for VED exemption moves forward by twelve months.

For example, for a car to qualify for VED exemption in 2024 it must have been registered before 1 January 1984. However, from the start of 2025, the exemption date will roll forward to cover all models first registered before 1 January 1985.