Car Tax Increase for Older Drivers Confirmed for April
The UK government has confirmed an increase in Vehicle Excise Duty (VED) rates for all car owners, effective from April 2026. This alteration will specifically impact petrol, diesel, and electric vehicle drivers.
New VED Rates Effective April 2026
Starting in April 2026, most motorists will face higher annual charges. The standard VED rate will increase from £195 to £200, affecting nearly all vehicle owners. Elderly drivers will not receive any age-related exemptions and must pay the same rates as other drivers.
Exemptions from the New Charges
- Disabled drivers will remain exempt from paying VED.
- Vintage vehicles registered over 40 years ago will also not be subject to these charges.
Specific Increases by Vehicle Type
The adjustments will significantly impact new vehicle purchasers. For instance:
- The initial VED charge for new petrol and diesel cars will rise from £5,490 to £5,690.
- Vehicles over 1549cc, registered before March 1, 2001, will see their annual fees increase from £360 to £375.
- For smaller vehicles under 1549cc, the annual fee will increase from £220 to £230.
Regular Increases in VED
VED rates are indexed to inflation, meaning they typically rise annually. The recent announcement was made by HM Revenue and Customs (HMRC) following the Autumn Budget presented by Rachel Reeves. The new legislation will be included in the Finance Bill for 2025-26.
Impact on Electric Vehicle Owners
Electric vehicle drivers will experience a smaller impact from the new tax rates. Established electric vehicles registered before 2017 will continue to incur an annual fee of £20. New zero-emission cars will maintain a first-year VED of just £10.
These changes reflect the government’s adjustment of VED in line with the Retail Price Index, taking effect from April 1, 2026. Motorists should prepare for increased expenses as new regulations come into effect.
