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[2017] Road Tax (VED) Changes

The UK Government is changing the Vehicle Excise Duty (VED) for new vehicles registered on or after 1st April 2017. This will affect both first year rates (“Showroom Tax”) and subsequent years.

Why is VED changing?

This legislative change is to address the increasing number of cars registered which are paying little or no VED.

Anyone planning to order a new car soon will need to be aware that VED is changing for vehicles registered from 1st April 2017.

Which vehicles are affected by this change?

All new cars registered on or after 1st April 2017 will be levied a flat, standardised rate of VED of £140.

The First Year Rates of VED will still vary according to the carbon dioxide (CO2) emissions of the vehicle as they do today, though the amounts charged are changing.

A flat Standard Rate of VED of £140 will apply in all subsequent years, except for zero-emission cars for which the standard rate will be £0.

Any cars with a manufacturer list price (including options and VAT) of over £40,000 will incur an additional, supplementary charge of £310 per annum, payable from year two to six. This means that vehicles registered on or after 1st April 2017 that fall into a list price category of over £40,000 will pay the £140 standard rate plus an additional rate of £310, reaching a total of £450 per year for the first five years.

All cars first registered before 1st April 2017 will remain in the current VED system, which will not change.  Vans are excluded.

What are LeasePlan doing?

LeasePlan are committed to ensuring that all quoting systems will be updated to reflect the new VED rates in due course and are working closely with the relevant agencies to fully understand how the new legislation will impact our customers.

We will also be providing you with regular updates over the coming months to explain more about the changes and how they will affect cars registered after April 1st 2017.

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