Is Road Tax Going Up in 2021?

VED tax is arguably one of the most tedious parts of owning and driving a car in the UK. As soon as you think you know how much VED tax you have to pay, the rates change!

On the 1st April 2021, the chancellor announced changes to VED tax rates upon releasing the budget for 2021-2022.

A lot of the changes to VED tax rates are centred around the UK’s effort to reach net zero emissions and ban the sale of new petrol and diesel cars in 2030.

In short, the more CO2 emissions your car, van or 4X4 produces, the more VED tax you will have to pay.

It’s highly likely that VED tax rates will continue to change as we move closer and closer to our climate goals, and at Scrap Local we want to make sure that you know how much you’re paying to drive your car.

In this guide, we’ll discuss what VED tax is, why it’s changing and which VED tax band your vehicle falls into so that you can see how much you’ll need to pay.

Do you want to switch to a cleaner vehicle to reduce the amount of VED tax you pay? 

Then, why not scrap your old petrol or diesel car with us at Scrap Local?

We’ll show you how to scrap your old petrol and diesel without any hassle and for some of the best scrap prices.

Get a quote with us today to make the most from your old car.

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What is VED Tax?

VED stands for Vehicle Excise Duty.

More commonly known as either road tax or vehicle tax, VED is a tax for registered vehicles in the UK.

How much VED tax you will need to pay largely depends on when your vehicle is first registered

In addition to this, other factors can also impact the amount of VED tax you have to pay in the UK. Some of these include:

Based on both the date your vehicle is first registered and the above factors, you will be put into a VED tax band and charged a certain amount for your vehicle.

What Qualifies You to be Tax Exempt?

Whilst some vehicles like classic cars might be exempt from paying VED tax, it’s always a good idea to double-check and apply for vehicle tax exemption if you believe that you’re eligible for it. 

For more information on vehicles exempt from VED tax, visit the official GOV.UK website.

It is illegal to drive an untaxed vehicle if you are not exempt.

Luckily, you can check if your vehicle is taxed or not without any hassle.

Are Tax Rates Changing in 2021?

VED tax rates are always subject to change and it can be difficult for UK road users to keep track of how much VED tax they need to pay.

Climate change is a growing problem in the UK and recent changes to VED tax rates for vehicles registered on or after the 1st April 2017 show that cars which emit higher CO2 emissions will be charged more.

The UK is at the forefront of tackling climate change and will be hosting the UN Climate Change Conference (COP26) in November 2021.

Phasing out diesel and petrol engines is a key point that the UK will raise at COP26 in relation to reaching a zero carbon economy.

Clean air zones are appearing in cities like Greater Manchester where air pollution is on the rise and more UK road users are being encouraged to switch to cleaner, electric vehicles prior to the upcoming ban on the sale of new petrol and diesel cars in 2030.

Due to this, it isn’t surprising that VED tax rates for vehicles which produce more emissions will increase in 2021.

What are the New VED Rates?

As stated before, VED tax rates are primarily based on when your vehicle is first registered.

Below we have provided a drop-down list for the current VED tax rates so that you can find out how much you will need to pay.

What is my VED Tax Rate Based on?

If your car was registered on or after the 1st April 2017, then your VED tax rate will largely be based on the amount of CO2 emissions your vehicle produces.

 

How does VED Tax work?

When you first register your vehicle, you will need to pay VED tax to cover it for 12 months

The VED tax rate you pay for these 12 months will be based on the amount of CO2 emissions your vehicle produces per kilometre. 

The amount of VED tax your pay for these 12 months will also be impacted by the type of fuel your vehicle uses.

For instance, you will have to pay a higher VED tax rate if you have a diesel car which doesn’t meet the standards for nitrogen oxide emissions set out by Real Driving Emissions 2 (RDE2). 

Afterwards you will need to pay VED tax every 6 or 12 months at a different rate. 

 

How Much VED Tax do I pay?

The amount you will be charged for your following VED tax payments will depend upon these two factors.

1. The type of fuel your vehicle uses.

Your VED tax rate will depend upon whether your vehicle uses:

Petrol or diesel.

Electric.

Alternative fuel such as hybrids, bioethanol and liquid petroleum gas.

2. Whether you choose to pay via direct debit or not.

The amount you pay for VED tax could reduce slightly if you pay via direct debit.

 

Motorhomes eligible for this VED Tax Rate

If you drive a car or motorhome with a list price of more than £40,000, then you may need to pay an extra £335 a year. 

The list price is the published price of a vehicle before any discounts.

You will need to pay this fee for 5 years from the second time your vehicle is taxed.

That being said, if you have a zero emissions vehicle, you will not need to pay this extra charge.

 

View our tables below to see which VED tax band your vehicle falls into for the first 12 months and future VED tax payments.

What is my VED Tax Rate Based on?

If your vehicle is registered between 1st March 2001 and 31st March 2017, then your VED tax rate will be based on the type of fuel your vehicle uses and the amount of CO2 emissions it produces per kilometre.

 

How does VED Tax work?

You will pay a specific amount every 6 or 12 months depending on which VED tax band your vehicle falls into.

Vehicles registered between 1st March 2001 and 31st March 2017 will be grouped by the type of fuel they use. These are:

1. Petrol and Diesel.

2. Alternative fuel.

The VED tax band your vehicle falls into will be labelled under a letter of the alphabet between A and M for your convenience.

It’s important to note that any vehicle registered before the 23rd March 2006 with a CO2 figure over 225g/km will be put into VED tax band K.

 

To see which VED tax band your vehicle falls into, view our table for vehicles registered between the 1st March 2001 and 31st March 2017 in this article.

What is my VED Tax Rate Based on?

If you have a car or light goods vehicle registered before 1st March 2001, then your VED tax rate will be based on the size of your vehicle’s engine.

 

How does VED Tax work?

You will pay a certain amount of VED tax every 6 or 12 months.

The amount of VED tax you pay will depend on which VED tax band your vehicle falls into. These are:

1. An engine size below 1549 cc.

2. An engine size over 1549 cc.

 

To see which VED tax band your vehicle is categorised under, view our VED tax rate tables below.

What is my VED Tax Rate Based on?

For most motorhomes your VED tax will be based on its revenue weight. This is also called maximum or gross vehicle weight.

To find out more about different vehicle weights and what they could mean for you, please visit the official GOV.UK website.

How does VED Tax work?

You will be charged a VED tax rate based on the weight category your motorhome falls into.

Your motorhome will either be classed as a private or lights good vehicle or as a private heavy goods vehicle

If it has a revenue weight of 3,500kg or less, then it will be classed as a private or light goods vehicle and you will need to pay a VED tax rate for this band.

If it has a revenue weight that’s over 3,500kg, then it will be classed as a private heavy goods vehicle and you will need to pay a VED tax rate for this band.

 

Motorhomes registered between 1st April 2017 and 11th March 2020

If your motorhome was registered between 1st April 2017 and 11th March 2020, then you’ll pay VED tax for cars registered on or after 1st April 2017

You will also need to pay a different VED tax rate if your motorhome is:

1. Categorised as M1SP by the dealer.

2. Its CO2 emissions are included on the “Type Approval Certificate” for the vehicle. This certificate can also be called a “Certificate of Conformity” or “Individual Vehicle Approval”.

To see which VED tax band your vehicle falls into, please view our VED tax rate table for motorhomes below.

If you have one of the vehicles listed below, then you will need to pay a different VED tax rate:

1. Light Good Vehicles (TC39)

Your light goods vehicle must be registered on or after 1st March 2001 to pay this VED tax rate.

Your light goods vehicle must also have a revenue weight which does not exceed 3,500kg.

2. Euro 4 Light Goods Vehicles (TC36)

Your vehicle must be registered between 1st March 2003 and 31st December 2006 to pay this VED tax rate.

Additionally, it must be Euro 4 compliant and have a revenue weight which does not exceed 3,500kg.

3. Euro 5 Light Goods Vehicles (TC36)

Your vehicle must be registered between 1st January 2009 and 31st December 2010 to be eligible for this VED tax rate.

It must also be Euro 5 compliant and have a revenue weight which does not exceed 3,500kg.

4. Motorcycles with or without a sidecar (TC17)

Your VED tax rate will depend on your motorcycle’s engine size.

5. Tricycles which are not 450kg unladen (TC50)

Your VED tax rate will depend on your tricycle’s engine size.

 

Read on to see our tables for which VED tax band your vehicle falls into.

What are the VED Tax Bands?

To help you understand which VED tax band you fall into and how much VED tax you will need to pay, we have created the following tables listing different VED tax rates for vehicles registered on or after the aforementioned dates.

It’s important to remember that VED tax rates are subject to change.

We recommend that you also use the official GOV.UK to double check VED tax rates in the UK.

VED Tax Bands for Cars registered on or after 1st April 2017

ved,tax,bands,for,first,payment,12,month,cover
ved,tax,bands,for,second,tax,payment,onwards,and,ved,tax,bands,for,vehicles,with,a,list,price,of,more,than,£40000


VED Tax Bands for Vehicles registered between 1st March 2001 and 31st March 2017

ved,tax,bands,for,petrol,and,diesel,cars,registered,between,1st,march,2001,and,31st,march,2017
ved,tax,bands,for,alternative,fuel,cars,registered,between,1st,march,2001,and,31st,march,2017


VED Tax Bands for Cars and Light Goods Vehicles registered before 1st March 2001

ved,tax,bands,for,private,or,light,goods,vehicles,tc11,registered,before,1st,march,2001


VED Tax Bands for Motorhomes registered before 1st April 2017

ved,tax,bands,for,motorhomes,classed,as,private,or,light,goods,vehicles,tc11,and,ved,tax,band,for,motorhomes,classed,as,private,heavy,goods,vehicles,tc10


VED Tax Bands for Other Vehicles

ved,tax,band,for,lgvs,registered,on,or,after,1st,march,2001,euro,4,lgvs,euro,5,lgvs
ved,tax,bands,for,motorcyles,with,or,without,a,sidecar,tc17,ved,tax,bands,for,tricycles,tc50,not,over,450kg,unladen

How Do I Scrap My Car?

Whilst VED tax might be low for some road users, for others it might be too expensive and not worth shelling out for.

Climate change is a continual problem and it’s clear that low emission, electric vehicles are on the rise as more funding is going towards schemes to install electric charge points in the UK. 

If you are looking to switch to a cleaner and less expensive vehicle, why not scrap your old car with our team of agents at Scrap Local!

We deal with thousands of scrap car enquiries and can connect customers with reliable scrap yards no matter where they are in the UK.

We aim to make scrapping your car as easy as possible and have an in-depth guide listing all the things you need to do to scrap your car with one of our agents.

Get a scrap car quote with us today and we’ll help you find the best scrap price for your vehicle.

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