Nine things moved for UK car buyers across 2025 and 2026, each with a date. Electric cars lost their vehicle tax exemption on 1 April 2025 and now pay the £200 standard rate. From 1 April 2026 the Expensive Car Supplement runs two thresholds — £50,000 for zero emission cars first registered on or after 1 April 2025, £40,000 for everything else — and the zero emission first-year rate is £10. The historic tax class rolled to cars built before 1 January 1986, exempt from 1 April 2026. The 2026 ZEV mandate set a 67% non-ZEV allowance for cars, which is a 33% zero emission target by subtraction. Greater Manchester's charging Clean Air Zone was dropped, GOV.UK removing the references on 18 February 2025. The Financial Conduct Authority's motor finance redress scheme was confirmed on 30 March 2026 and partially suspended by the Upper Tribunal on 1 July 2026. Used battery electric took a record 3.5% share of UK used transactions in 2025, on SMMT figures. And one is still ahead of us: domestic electricity in Great Britain is zero-rated for VAT from 1 October 2026 to 31 March 2027.
The Expensive Car Supplement gained a second threshold
The supplement is £440 a year on top of the standard rate, payable in years two to six — five payments, £2,200. One figure used to decide it: a list price over £40,000 when new. From 1 April 2026 there are two: the threshold rises to £50,000 for zero emission cars first registered on or after 1 April 2025, and everything else stays at £40,000. The registration date decides which threshold applies; 1 April 2026 is when the £50,000 one starts to bite, and the two line up because the supplement runs from year two.
| Car | Threshold | Supplement |
|---|---|---|
| Petrol, diesel or alternative fuel, registered on or after 1 April 2017 | £40,000 list price when new | £440 a year, years 2 to 6 |
| Zero emission, first registered on or after 1 April 2025 | £50,000 list price when new | £440 a year, years 2 to 6, from 1 April 2026 |
| Zero emission, first registered 1 April 2017 to 31 March 2025 | No threshold applies | None, at any list price |
The last row is the one almost everyone gets wrong: an electric car first registered between 1 April 2017 and 31 March 2025 pays the £200 standard rate and no supplement at all, whatever it cost new. What counts is the list price when new, not what the car sells for today, so ask the seller what it listed at. Our guide to the supplement on used electric cars works through the cases; the car tax calculator gives the annual figure.
Electric cars pay vehicle tax now, and £10 in the first year
The zero rate ended on 1 April 2025. An electric car registered on or after 1 April 2017 pays the same £200 standard rate as a petrol or diesel car of the same age. From 1 April 2026 the zero emission first-year rate is £10, charged once at first registration, so a used buyer never sees it.
Full bands for every fuel and era are in our complete guide to UK vehicle tax rates. And tax does not transfer on sale: the seller's is cancelled and refunded to them, so you tax the car before driving it or declare SORN — our guide to taxing a car you have just bought covers the handover.
The historic tax exemption rolled forward to 1986
The historic vehicle tax class rolls on. From 1 April 2026 it covers cars built before 1 January 1986, so a 1985 car became exempt that April. It is not automatic: you apply, and until you do the car keeps its existing class. Transport for London also exempts vehicles in the DVLA historic tax class from the ULEZ charge, alongside anything built before 1 January 1973. Tax and MOT exemption are separate questions — see our MOT exemption page.
Home electricity loses its VAT for six months, from 1 October
Domestic electricity in Great Britain is zero-rated for VAT from 1 October 2026 to 31 March 2027; it normally carries 5%. That window is the one item on this page that has not started yet. Ofgem's cap for a Direct Debit customer in Great Britain is 26.11p per kWh including 5% VAT for 1 July to 30 September 2026, and 26.32p per kWh excluding VAT for 1 October to 31 December 2026 — figures Ofgem says cannot be compared directly, one containing a tax the other does not.
What happens after 31 March 2027 has not been published; an extension is to be considered at the Autumn Budget. Northern Ireland runs separately: the Utility Regulator sets a maximum average price for Power NI, about £1,093 a year at 3,200 kWh from 1 July 2026, with VAT still at 5%.
The change that did not happen: public charging
Public charge point electricity is standard-rated at 20% VAT, and the domestic zero-rating did nothing to it. At the Department for Transport's 3.5 miles per kWh, which allows for charging losses:
The gap that matters is between charging at home and charging in public, not between electric and petrol. On an overnight tariff an electric car runs at about 2.3p a mile; on the Great Britain price cap about 7.5p; on public rapid charging about 26.3p — dearer than petrol at 40mpg, which is about 18.4p. Our guide to the best used cars if you cannot charge at home sets out the full comparison and what to buy if a driveway is not an option.
Public rapid charging costs more per mile than petrol, and is dearer at every mpg from 30 to 60. Rapid prices were 85p to 92p per kWh when checked on 9 September 2026 and change without notice; the 8p overnight rate needs a smart meter and an eligible car, so a driver with no off-street parking cannot reach it. Our charging cost calculator, charging costs guide and short answer page take your own mileage.
Greater Manchester's charging zone was dropped
Greater Manchester has no charging Clean Air Zone. GOV.UK removed the references on 18 February 2025, so advice to check a Manchester charge is stale. That leaves seven zones in England — Bath (class C), Birmingham (D), Bradford (C), Bristol (D), Portsmouth (B), Sheffield (C) and Tyneside (C) — and only class D includes private cars. Exactly two of the seven charge a car: Birmingham and Bristol, and Bristol's car charge is £9 a day.
London's ULEZ is separate and much larger: £12.50 a day, every day except Christmas Day, across all boroughs, and our ULEZ answer page covers who pays it. Scotland's Low Emission Zones have no daily charge you can choose to pay: a non-compliant vehicle gets a £60 penalty, doubling for each further contravention to a £480 cap. Northern Ireland has none of these. Check the zone your route crosses with our clean air zone checker.
Motor finance redress: confirmed, then partly suspended
The Financial Conduct Authority confirmed a motor finance redress scheme on 30 March 2026, in Policy Statement PS26/3. The Upper Tribunal's suspension order is dated 1 July 2026 — the FCA published its statement on it the following day — and while that partial suspension stands, lenders are not required to calculate or pay redress. That is the status, and as far as this page will go: we will not tell you whether you are owed anything, and while the scheme is suspended nobody is calculating it. Our answer page on car finance compensation carries the eligibility window, the hearing dates and where a complaint goes.
The 2026 ZEV mandate, and the subtraction behind it
The headline is a 33% zero emission target for cars in 2026, and that is not the number the law states. What the Vehicle Emissions Trading Schemes Order sets for 2026 is a non-ZEV allowance: 67% of car registrations may be non-zero-emission. The target is the remainder.
100% − 67% = 33% for cars. For vans the allowance is 76%, so 100% − 76% = 24%.
It binds manufacturers, not buyers, and reaches you later, by shaping how many electric cars eventually arrive on the used market. The wider dates are unchanged: new pure petrol and diesel car sales end in 2030, full and plug-in hybrids permitted to 2035.
Used electric hit a record 3.5% share
Used battery electric took 274,815 of the 7,807,872 used car transactions SMMT recorded in the UK in 2025 — a record 3.5% share, up from 2.5% in 2024, with used electrified cars as a whole at 9.9%. Record and small are both true, and supply explains it: the Department for Transport counted 2,012,000 zero emission vehicles licensed at the end of 2025, 4.8% of 42.3 million. Our used car prices report covers volumes and pricing.
What this means if you are buying now
- Check an electric car's registration date first. Before 1 April 2025 the supplement cannot apply at any list price; on or after it, the £50,000 threshold does.
- For any car near £40,000 new, ask what it listed at — not what it costs now. The £440 follows the car, not the owner.
- Budget for tax on day one. It does not transfer: the seller gets a refund and you start again.
- With no off-street parking, do the per-mile sum first: 26.3p on public rapid against 18.4p on petrol at 40 mpg.
- Check the one zone your commute crosses. Two English zones charge cars, London runs its own, Scotland issues penalties, Northern Ireland has none.
- On motor finance redress, there is nothing to do right now — the scheme is partially suspended.
- If the car was built in 1985 or earlier, apply for the historic class — it is not automatic, and it carries the ULEZ exemption too.
All of that is rules, not forecasts. Where a rule runs out — VAT on domestic electricity after 31 March 2027, most obviously — no UK body has published what comes next. To shop against these dates, start with our used car listings.
