Vehicle Excise Duty, or VED, is commonly referred to as car tax, vehicle tax or road tax.
The tax is paid to the Driver and Vehicle Licensing Agency (DVLA). Without it, it’s illegal to drive or even keep a car on UK roads. Road tax as people knew it changed in 2014, and there are now additional changes to the system planned for 2028.
Road tax: the basic changes
Before 2014, drivers would display a round paper disc on their car’s windscreen to show the vehicle was taxed and legally allowed on the road.
But in 2014, the rules changed to modernise how vehicle tax is collected and save the DVLA money in admin expenses.
Then, in the 2025 Budget, further changes were announced that could affect EVs and plug-in hybrids.
These plans are currently in consultation with a proposed start date of April 2028.
History of road tax changes:
- 2014: tax disc abolished
- 2025: EVs start paying VED
- 2028: proposed mileage-based eVED
Here’s a summary of the road tax changes that are in place as of June 2026, and how they could affect you.
Road tax rule changes – what do they mean?
As of 2014, road tax no longer transfers with a vehicle when it’s sold. This means you can no longer sell a used car and include any remaining tax as a sweetener, and the new buyer must tax the vehicle in their name before they drive it.
The 2014 rule changes also led to the abolition of the paper tax disc that used to be displayed in every car’s windscreen. Instead, road tax is now enforced by DVLA databases and tools, including Automatic Number Plate Recognition (ANPR), which flags cars whose owners haven’t paid tax.
Road tax rules when you buy a car
Under the current rules, when you buy a car, even if the owner says the car is taxed, that tax isn’t valid once you’ve taken ownership of the vehicle.
So, if you want to drive a car you’ve just bought legally on public roads, the car must be taxed in your name.
That means if you’re buying a used car from a dealership, you need to tax it with the DVLA before you take delivery of the car. Vehicle tax is charged in full months, so your tax will begin from the start of the month in which you buy the car.
If you’re buying a new car, road tax is sometimes included in the purchase price, but the dealership will need your insurance details to tax it in your name.
Road tax rules when you sell a car
As part of the 2014 changes, the rules around selling a car became much stricter.
You must now inform the DVLA as soon as you sell a car or you could face a fine of £1,000. The DVLA will then reimburse you for the remaining complete months of the tax you haven’t used. If it owes you money, the DVLA will send you a cheque within six weeks.
Which vehicles don’t need road tax?
All cars need to be taxed to be driven or kept on UK roads, but some vehicles are eligible for free or reduced tax.
Road tax rules for different types of cars:
Electric, zero and low-emission vehicles
- As of April 2025, electric and other low-emission cars, vans and motorcycles are no longer exempt from paying road tax.
- The rate you need to pay depends on when the vehicle was first registered and its CO₂ emissions or standard rate band.
- Further changes for EVs and plug-in hybrids are planned for April 2028.
Historic vehicles
- There is currently a rolling 40-year exemption in place for historic vehicles.
- For example, from April 2026, vehicles first registered before 1 January 1986 qualify. As of April 2027, this will change to cars registered before 1 January 1987 – and so on.
Disability vehicles
- Some drivers can get free vehicle tax or a 50% reduction. They must receive a certain disability‑related benefit, and the vehicle must be registered in their name or their nominated driver’s name and used for their personal needs.
For the latest rules, check the current exemption thresholds and eligibility criteria.
Do I still need to tax my car if it qualifies for a free rate?
Yes. Even if your car is eligible for free or reduced road tax, you still need to go through the process of taxing it – you just won’t need to pay anything.
What if I don’t tax my vehicle?
If you fail to tax your car correctly, then you could be liable to pay a fine, your vehicle could be clamped, or you could even be taken to court, so it’s important to get road tax right.
Some insurers require your vehicle to be taxed as part of their policy terms, so it’s worth checking your insurer’s conditions.
What happens if I declare SORN?
A Statutory Off-Road Notification (SORN) can be used as an alternative to road tax, provided your car is kept off public roads.
You need to notify the DVLA that you’re registering a SORN declaration – and you won’t be able to drive your car on the road. This is important to remember, as if you’re selling your car and want potential buyers to be able to test drive it then it will need to be taxed, not declared as SORN.
SORN can be useful if you’re keeping your car on a private driveway or storing it in a private garage for a long period of time.
What about tax when test-driving a car?
If you’re planning to test-drive a car, it must be taxed and insured for you to legally test-drive it on UK roads.
If it’s a used vehicle you’re buying privately, check before your test drive that it’s correctly taxed and insured.
If you’re buying from a dealership, the car should be displaying what are known as trade plates (temporary registration plates). If the dealer doesn’t have trade plates, they must tax the vehicle so people can test-drive it.
Road tax rules for electric vehicles (EVs)
A proposed Electric Vehicle Excise Duty (eVED) was announced as part of the 2025 Budget.
If the new rules go ahead, as of April 2028, owners of EV or plug-in hybrid vehicles could be charged a ‘pay-per-mile’ tax to drive on UK roads. This proposal is in addition to the current road tax requirements.
If it comes into force, the process for paying eVED will be part of the DVLA’s current VED system, with more details expected to be released closer to the time.
Where to check the latest vehicle tax rules
As of 2026/27, the standard VED rate is around £200 per year for most cars, although first-year rates vary based on emissions.
It’s important to remember that road tax laws and requirements are constantly changing, and the rate you need to pay also changes each year.
For the latest guidance, always check the GOV.UK website.
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