How to Tax a Car: Your Online Guide to Taxing a Car

car-tax-checker

Having VED/road tax is a legal requirement for UK roads, not having road tax can lead to some heavy fines. To avoid getting into that situation this guide will help to show you how you can check your road tax and pay for it online.

What is the VED?

Vehicle Excise Duty (VED) is the ‘official’ term for car tax. The DVLA, Driver and Vehicle Licensing Agency, is responsible for collecting your car’s road tax. They upkeep a database of all of the car’s on the UK road’s and know everything about car tax and MOT’s.

Car tax is a requirement for vehicles that are not declared SORN (Statutory Off Road Notification) and even if they are stored at a private property, it still needs road tax.

How much car tax do I need to pay?

This is dependant on which VED band your car falls in to. The UK government has put in place targets and goals for emissions which means that the VED bands fee’s are heavily connected to the level of CO2 emissions that your car emits.

There are different rates of tax depending on when your car was first registered. The bands are as follows [as of November 2017]:

  • Car was first registered on or after 1st April 2017
  • Car was first registered between 1st March 2001 and 31st March 2017
  • Car was first registered before 1st March 2001

Registered on or after 1st April 2017

This will mean that the cost of the first year of road tax will be dependant on CO2 emissions.

But the good news is that when you renew, it will be a lower fee every year that is dependant on the fuel type, not emissions.

Vehicles that have a list price of £40,000+ (advertised price without discounts) will have to pay an additional £310 a year in car tax/VED. This will be required for 5 years which will begin from the second payment.

Some alternative fuel vehicles, typically electric vehicles, require no tax whatsoever to be paid (those with CO2 emissions of less than 50g/km and costing less than £40,000 to be more specific). If an electric vehicle emits more than 50g/km, it will need to have road tax paid for the first year and it will be free thereafter.

First year tax rates:

Rates for road tax after the first fee for cars registered on or after 1st April, 2017

Road tax rates for vehicles registered between 1st March 01 – 31st March 17:

If your car was registered before 1st March 01 then the tax rate is based on the engine size. There are two tiers for cars registered before this date:

Up-to 1549cc = £145.00/year

Over 1549cc = £235.00/year

What changes were made to car tax in 2017?

As the UK government has targets in place to fight against climate change and the levels of CO2 that each country produces, 2017 saw new rules put into place for car tax.

Previously, the car tax on a vehicle that emits CO2 emissions over 255g/km would have cost £550 for the first year. Now though that will cost you £2000 with the new rules made in 2017.

This initially large charge at the beginning of owning a car was designed to put people off buying heavy emitting cars based on the high first year of road tax.

What changes were made to car tax in 2018?

From April 1st 2018, new diesel vehicles may be subject to move one band above their original band if they don’t meet the latest Euro 6 emissions standards in the RDE2 ‘real world’ tests.

The test measures the amount of NOx emissions that a vehicle products through ‘real-world’ driving conditions. There’s a current limit of 80mg/km which has been set by the UK government.

Pay for car tax at the Post Office

Requirements – at least one of the below:

  • V11 letter from the DVLA (sent to you around a month before your VED due date).
  • V5C logbook – the V5, your vehicle’s logbook. This must be in your name.
  • V5C/2 – the new keeper’s slip.
  • V85/1 – if it’s a Heavy Goods Vehicle (HGV)

Simply head to your local branch with one of these forms (V11, V5C or V5C/2) and a member of staff will be able to help. Payments can be made by:

  • Direct Debit
  • Cheque payable to Post Office Limited
  • Debit Card
  • Cash (excluding by post)
  • Post Office Budget Card
  • Postal Order
  • Sterling travellers cheques
  • Credit Card (£2.50 handling fee)

Pay for car tax online

Requirements – at least one of the below:

  • V11 letter from the DVLA (sent to you around a month before your VED due date).
  • V5C logbook – the V5, your vehicle’s logbook. This must be in your name.
  • V5C/2 – the new keeper’s slip.
  • V85/1 – if it’s a Heavy Goods Vehicle (HGV)
  1. Visit the UK GOV site and select ‘Start Now’
  2. Select if you have the V11 reminder letter (must be printed in your name)

3. Enter the vehicle’s registration number and 11 digit reference (where to find these details are shown on the page)

4. Check and confirm the details that are presented to you

5. Choose how you wish to pay – monthly or yearly.

Getting a car tax refund

There are a number of situations and circumstances where you may be able to get a car tax refund.

When it is written-off

This is essentially you selling the vehicle to the insurance company and so you could be issued a car tax refund if there’s any remaining on it.

You need to inform the DVLA is your vehicle has been written off to get a refund. Visit here to get started.

When the car is stolen

If the insurance company has paid out because of a stolen car then you will be due for a car tax refund. This is only if it is not due for renewal.

You will need to inform the DVLA once the insurance has been paid out.

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