Changes to vehicle tax on electric vehicles

    From 1 April 2025, drivers of electric and low emission cars, vans and motorcycles will need to pay vehicle tax in the same way as it is currently applied to internal combustion engines (ICE).

    This change will apply to both new and existing vehicles meaning all drivers will make a tax contribution, regardless of the CO2 output of their vehicle. Of course the rate for zero and low emission vehicles will be proportionate against the tariffs for ICE.

    This new measure effectively removes band A under the graduated VED system (currently £0). Vehicles in this band will now be moved into the first band where a rate becomes payable.

    New registrations


    Year one
    Electric and low emission vehicles registered on or after 1 April 2025 will attract the lowest first year rate of vehicle tax (applied to CO2 emissions 1 to 50g/km currently).


    Subsequent years
    From the second tax payment onwards, these vehicles will now attract the standard rate (£190 at time of print but subject to change for 2025).


    Additional rate (commonly referred to as the expensive car supplement)
    Electric vehicles with a list price exceeding £40,000 will now attract the expensive car supplement from the second tax payment onwards. This will apply to vehicles registered on or after 1 April 2025.

    Existing vehicles

    Zero and low emission vehicles registered between 1 April 2017 and 31 March 2025 will pay the standard rate for subsequent years RFL (£190 at time of print but subject to change for 2025).

    The £10 annual discount for AFVs and hybrids will be removed, and the rate customers will pay will depend on when the vehicle was first registered. If the vehicle was:


    Registered before 1 April 2017

    This rate will depend on the vehicle’s CO2 emissions (check the current rates for this vehicle)


    Registered on or after 1 April 2017

    The standard rate applies (£190 at time of print but subject to change for 2025).


    We have recently communicated that any changes in the governments RFL pricing will be invoiced on the anniversary of the vehicle contract, meaning any existing monthly payments will remain unchanged with an additional annual invoice raised to cover any increases.

    Fast forward

    Do you like to read more, are you curious about our related solutions and cases, or would you like to find out what Athlon can do for you? 

    Related solutions

    Business Man Crossing Street Finance Lease

    A tailored advice and custom use of mobility services will suit your continuously changing needs.

    All solutions