Road Tax Changes

Everything You Need to Know About the 2020 Vehicle Excise Duty (aka Road Tax) Changes

From April 1st 2020, Vehicle Excise Duty (widely known as car tax or road tax) is changing. And while it’s altered frequently, it’s still best to keep up to speed with the updates in order to know how it will affect you.

Here’s what you need to know about the latest alterations coming into force…

How will VED be calculated?

In April, the first year of VED on a car will be calculated using WLTP (Worldwide Harmonised Light Vehicle Test Procedure) carbon dioxide figures, meaning the cleaner the car, the less you’ll need to pay.

While it used to be determined through the NEDC (New European Driving Cycle) test, which was last updated in 1997, that isn’t the case anymore due to it being generally considered outdated with the rise of advanced technology in the last decade.

Is VED increasing?

In short, yes. This is due to the upcoming WLTP method being able to determine a more realistic evaluation of your vehicle’s official fuel consumption (mpg), driving range of CO2 emissions (g/km), resulting in cars’ CO2 emission output changing and placing vehicles in higher tax bands to its current rate.  

When exactly will it be introduced? 

For Vehicle Excise Duty, the change is planned to be introduced on April 1st 2020, while Benefit-in-Kind on Company Car Tax is set for April 6th 2020. The alteration will only affect your first VED payment when buying and registering a new vehicle after these dates.

What kind of First-Year Rates will I have to pay?

That of course depends on the kind of CO2 your car is emitting. If it’s 0g/km and in VED Band A (the grouping reserved for zero-emissions vehicles), then you won’t have to pay anything.

However, on the other side of the spectrum, there’s VED Band M for cars which emit over 255g/km of CO2. Owners of cars in this band will have to fork out £2,135.

Around the middle, there’s VED Band G – for cars emitting 111 to 130g/km of CO2 – which will have to pay £170.

Please note, these figures aren’t for non-RDE2 diesels and alternative fuel vehicles. 

Is it possible to beat the VED increase?

To avoid the increase, it’s as simple as buying a new car before April 2020 when road tax increases. This could save you quite a bit of money on the first year of VED.

How much will my car tax be?

VED BandCO2 Emissions (g/km)First-Year RateFirst-Year Rate for non-RDE2 DieselsAlternative Fuel Vehicles
A 0 £0 £0 £0
B 1 - 50 £10 £25 £0
C 51 - 75 £25 £110 £15
D 76 - 90 £110 £130 £100
E 91 - 100 £130 £150 £120
F 101 - 110 £150 £170 £140
G 111 - 130 £170 £210 £160
H 131 - 150 £210 £530 £200
I 151 - 170 £530 £855 £520
J 171 - 190 £855 £1,280 £845
K 191 - 225 £1,280 £1,815 £1,270
L 226 - 255 £1,815 £2,135 £1,805
M Over 255 £2,135 £2,135 £2,125

Click here to view Government site for VED changes