New tax charges to hit electric vehicle owners from April 2025

Electric vehicle (EV) owners are set to face new road tax charges from 1 April 2025, as the current exemption on Vehicle Excise Duty (VED) for zero-emission cars will end.

Experts are highlighting the importance of understanding these impending financial changes for both current and prospective EV owners.

Currently, electric and zero-emission vehicles enjoy an exemption from road tax. However, this will change in less than a year's time, following the guidelines set in the 2022 Autumn Budget. Starting from the VED deadline on 1 April 2025, new registrations of low or zero-emission cars will initially benefit from a minimal annual VED rate of £10. This rate is applicable only for the first year post-registration.

Post the initial year, these vehicles will transition to the standard VED rate, which currently stands at £190 annually. Additionally, EV owners who registered their vehicles between 1 April 2017 and 31 March 2025, will also be subject to this standard rate.

Furthermore, the cessation of the Expensive Car Supplement scheme, which has so far exempted electric vehicles, means an additional financial burden. From April 2025, owners of new electric cars costing over £40,000 will have to pay a £355 surcharge for the first five years of registration, aligning them with the tax rates of more expensive internal combustion engine vehicles.

With these changes on the horizon, EV experts are advising current and future electric vehicle owners to prepare for these additional costs, ensuring they remain informed and financially ready for the shift in April 2025.

Greg Wilson, Founder and CEO of Quotezone.co.uk, said: “Any current EV driver, or motorist who is planning on purchasing a zero-emissions vehicle must ensure they are aware of the upcoming additional charges they will face. 

“Currently EVs are exempt from paying VED but drivers now have less than a year to prepare for the new charges which will be coming into place from the 1 April 2025.

“If you’ve been driving your zero-emissions car since April 2017 you will soon be subject to paying £190 of car tax.

“Anyone who registers their vehicle on the 1 April 2025 deadline will make them liable to pay the lowest rate (currently £10), which will be increased to £190 after the first year. 

“These road tax charges will be affecting all current and future electric vehicle drivers so it’s important for anyone planning to buy a zero-emissions car to know what they will be expected to pay in less than a year’s time and factor these changes into their decision-making process.”