2021.7.0 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 £2,175 for company cars emitting the highest level of emissions.

In subsequent years, there is a standard rate of:

  • £150 for all petrol and diesel cars
  • £140 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 £325 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)

Petrol and RDE2-certified diesel cars 

All other diesel cars

Alternative fuel cars including electric

0

£0

£0

£0

1-50

£10

£25

£0

51-75

£25

£115

£15

76-90

£115

£140

£105

91-100

£140

£160

£130

101-110

£160

£180

£150

111-130

£180

£220

£170

131-150

£220

£555

£210

151-170

£555

£895

£545

171-190

£895

£1,345

£885

191-225

£1,345

£1,910

£1,335

226-255

£1,910

£2,245

£1,900

Over 255

£2,245

£2,245

£2,235