GB/EN

VED car tax explained for Company Cars

Vehicle Excise Duty (VED) is a tax you pay when registering any new car and in every year it is used.

VED is split into 13 car tax bands based on CO2 emissions and fuel type, ranging from £0 for some low emission cars to £2,365 for company cars emitting the highest level of emissions.

In subsequent years, there is a standard rate of:

  • £165 for all petrol and diesel cars
  • £155 for alternative fuel cars
  • Electric cars are currently exempt

Company cars with a list price above £40,000, including any options fitted, must pay a premium of £335 for the first five years of standard rate payments. Zero-emissions cars are exempt from this premium. Hybrid models are classified as alternative fuel.

First-year VED rates:

CO₂ emissions (g/km)

First Year Rate

0

£0

1-50

£10

51-75

£25

76-90

£120

91-100

£150

101-110

£170

111-130

£190

131-150

£230

151-170

£585

171-190

£945

191-225

£1,420

226-255

£2,015

Over 255

£2,365