The Budget uprates vehicle excise duty for cars, vans and motorcycles by RPI from 1 April 2027 (paragraph 6.201), and HMRC has already published the 2027-28 rates in Annex A of the OOTLAR. The tables below put them next to the rates that apply now, from 1 April 2026.
Cars first registered from 1 April 2017
Source: HMRC, Budget 2026 OOTLAR Annex A. First-year rate for petrol, electric, alternative fuel and RDE2 diesel cars; other new diesels move up one band. The standard rate applies from the second tax payment.
| CO2 (g/km) | First year 2026-27 | First year 2027-28 |
|---|
| 0 (electric) | £10 | £10 |
| 1 to 50 | £115 | £120 |
| 51 to 75 | £135 | £140 |
| 76 to 90 | £280 | £295 |
| 91 to 100 | £365 | £380 |
| 101 to 110 | £405 | £425 |
| 111 to 130 | £455 | £475 |
| 131 to 150 | £560 | £585 |
| 151 to 170 | £1,410 | £1,475 |
| 171 to 190 | £2,270 | £2,375 |
| 191 to 225 | £3,420 | £3,575 |
| 226 to 255 | £4,850 | £5,070 |
| Over 255 | £5,690 | £5,950 |
| Standard rate (year two on) | £200 | £210 |
HMRC's tables still describe the expensive car supplement as £440 a year on top of the standard rate in years two to six, for petrol and diesel cars with a list price over £40,000 and zero emission cars with a list price over £50,000. The supplement goes by the list price when new, including options, not what you paid, so it matters when buying a nearly new premium car.
Cars first registered 1 March 2001 to 31 March 2017
Source: HMRC, Budget 2026 OOTLAR Annex A. 12-month rate. Band K includes cars over 225g/km registered before 23 March 2006.
| Band | CO2 (g/km) | 2026-27 | 2027-28 | Change |
|---|
| A | Up to 100 | £20 | £20 | None |
| B | 101 to 110 | £20 | £20 | None |
| C | 111 to 120 | £35 | £35 | None |
| D | 121 to 130 | £170 | £180 | +£10 |
| E | 131 to 140 | £200 | £210 | +£10 |
| F | 141 to 150 | £225 | £235 | +£10 |
| G | 151 to 165 | £275 | £290 | +£15 |
| H | 166 to 175 | £325 | £340 | +£15 |
| I | 176 to 185 | £360 | £375 | +£15 |
| J | 186 to 200 | £410 | £430 | +£20 |
| K | 201 to 225 | £445 | £465 | +£20 |
| L | 226 to 255 | £760 | £795 | +£35 |
| M | Over 255 | £790 | £825 | +£35 |
Older and other vehicles, 2026-27 to 2027-28: cars and vans registered before 1 March 2001 go from £230 to £240 (up to 1549cc) and £375 to £390 (over 1549cc). Most vans registered from 1 March 2001 go from £360 to £375. Motorbikes: £27 to £28 (up to 150cc), £59 to £62 (151 to 400cc), £90 to £94 (401 to 600cc) and £125 to £131 (over 600cc); our motorbike tax check has the current rules.
To see which band your car is in and what it pays now, use the free road tax calculator or the car tax check. Our April 2026 car tax guide explains how the bands and the supplement work.
This is the biggest money change in the Budget for many drivers. HMRC's approved mileage rate for cars and vans, the amount an employer can pay tax-free for business miles in your own car, was 45p a mile for the first 10,000 miles from 2011 until April 2026. In May the government raised it to 55p for 2026-27 as a temporary measure. Budget 2026 makes 55p permanent and lifts the rate above 10,000 miles from 25p to 35p from 6 April 2027 (paragraphs 3.14 and 6.213). Self-employed people using simplified expenses get the same rates.
Our calculation from HMRC's approved mileage rates. The most an employer can pay tax-free, or the deduction for a self-employed driver using simplified expenses, for cars and vans.
| Business miles a year | Old rates (45p, 25p) | From April 2027 (55p, 35p) | More tax-free |
|---|
| 5,000 | £2,250 | £2,750 | £500 |
| 10,000 | £4,500 | £5,500 | £1,000 |
| 15,000 | £5,750 | £7,250 | £1,500 |
| 20,000 | £7,000 | £9,000 | £2,000 |
If your employer pays less than the approved rate, you can claim tax relief on the gap from HMRC. Our mileage allowance guide shows how much tax you can get back at each mileage and how to claim.
Three things. First, pay-per-mile tax (eVED) is unchanged: 3p a mile for battery electric cars and 1.5p for plug-in hybrids from 1 April 2028, on top of normal car tax. The Budget adds a mileage estimation tool at launch, an opt-in "eVED Connect" system that reads mileage from the car's own connectivity, and an automated refunds model by 2030 for drivers who overestimate or sell (paragraph 2.38). The government's tax note says the mileage recorded at MOTs will be used to check the figures drivers give, so your car's MOT mileage history becomes part of its tax record. You can see it free with our MOT history check.
Second, charging. There is no VAT cut on public charging: the Budget confirms 20% VAT on public and workplace chargers from 1 November 2026 (paragraph 6.205). Home electricity stays at 0% VAT until 1 July 2027. £100 million over two years will cut prices at local, lower-powered public chargers from spring 2027. Third, car tax: electric cars pay the same £210 standard rate as petrol and diesel cars from April 2027, and £10 in the first year.
At the UK average of 7,400 miles a year, eVED adds £222 a year for a battery electric car and £111 for a plug-in hybrid (our calculation). The full figures, including charging costs per mile at home and on public chargers, are in our Budget 2026 guide for electric car drivers.
Company car tax rates for 2030-31 are set one percentage point above 2029-30 in every band: electric cars go from 9% to 10%, cars emitting 1 to 50g/km (most plug-in hybrids) from 19% to 20%, and the maximum to 40% (paragraph 6.207 and the tax information note). HMRC expects it to affect about 920,000 company car drivers.
Our calculation: list price x appropriate percentage x income tax rate. England, Wales and Northern Ireland income tax rates; Scotland's differ. Rates from HMRC's OOTLAR Annex A.
| £40,000 car | Rate | Taxable benefit | Tax a year at 20% | Tax a year at 40% |
|---|
| Electric, 2026-27 | 4% | £1,600 | £320 | £640 |
| Electric, 2029-30 | 9% | £3,600 | £720 | £1,440 |
| Electric, 2030-31 | 10% | £4,000 | £800 | £1,600 |
| Plug-in hybrid (1 to 50g/km), 2030-31 | 20% | £8,000 | £1,600 | £3,200 |
From 6 April 2027 employers must also report company cars, vans and fuel through payroll, so the tax is worked out and collected through payroll in real time rather than through end-of-year forms (OOTLAR 1.24). The car and van fuel benefit charges rise with CPI from 6 April 2027 (paragraph 6.203); the car fuel benefit multiplier will be £4,310.
- Insurance premium tax: 12% standard rate in 2027-28, the same as now (OOTLAR rate table).
- The MOT: the Budget document does not mention it. Check when yours is due with the free MOT due date checker.
- eVED rates: still 3p and 1.5p a mile, uprated by CPI from 2029-30.
- The expensive car supplement: no change announced; HMRC's tables still show £440.
- The Electric Car Grant: not changed in the Budget document. The government's charging announcement says the £2 billion grant has helped over 190,000 drivers save up to £3,750 on a new electric car.
- VAT on petrol and diesel: still 20%. The Budget did not cut it.
- The zero emission vehicle mandate: not changed in the Budget. The government aims to publish its response to the consultation on the mandate by the end of 2026, with any changes taking effect from 2027 (paragraphs 4.84 and 6.29).
Two other changes touch some drivers. Larger private hire operators will have to charge 20% VAT on the full value of their fares from 2 January 2028, above a turnover threshold that a consultation will set (the lead option is £50 million of fares a year; paragraph 6.219). The Budget does not say what that means for fares. And the Budget lists reforms to Motability that restrict its tax breaks and remove luxury vehicles from the scheme among measures the government has already taken.
- Know your car tax band. The new rates apply from 1 April 2027. Check what your car pays now with the road tax calculator, or whether a car is taxed at all with the car tax check.
- Budget for July 2027 fuel. Nothing changes at the pump because of duty before then. Our fuel cost calculator works out your own car's yearly fuel bill from its reg.
- If you drive your own car for work, keep a mileage log. HMRC asks for the reason, start postcode and end postcode of every journey, and you can claim for the current tax year and the four before it.
- Electric car owners: look at your recorded mileage. From April 2028 MOT readings will be used to check pay-per-mile estimates. The free mileage check shows every reading DVSA holds.
- Check your MOT date. The MOT due date checker shows it by reg, and the MOT history check shows past advisories that can turn into failures.
- Buying a used car? Check its tax band and whether it pays the £440 supplement, its MOT and mileage history, and then outstanding finance, write-off and stolen records with the £4.99 history check. A valuation tells you if the price is fair.
- HM Treasury, Budget 2026 document, 28 October 2026: paragraphs 2.38 (eVED), 3.12 to 3.16 (fuel duty, mileage rates, red diesel, HGVs, public charging), 6.200 to 6.213 (vehicle taxes, charging VAT, company cars, fuel duty, mileage rates), 6.29 (ZEV mandate) and Table 6.1 (costings).
- HMRC, Budget 2026: Overview of Tax Legislation and Rates and its Annex A rates and allowances (fuel duty, VED for 2027 to 2028, company car tax, insurance premium tax).
- HMRC and HM Treasury tax information notes: Electric Vehicle Excise Duty, company car tax rates, VAT on public EV charging.
- GOV.UK, Cutting electric vehicle charging costs (28 October 2026) and the 27 October announcement on mileage rates (published on GOV.UK late on 26 October).
- Pump prices: DESNZ weekly road fuel prices, week of 19 October 2026 (petrol 174.57p, diesel 199.33p a litre).
- The fuel duty plan before Budget 2026: HMRC, amended fuel duty rates for 2026 to 2027 (May 2026), and HM Treasury, Budget 2025 policy costings (RPI uprating from 1 April 2027).
Fuel figures are our calculations: litres a year = miles x 4.54609 / mpg; extra cost = litres x 7.64p duty x 1.2 for VAT. Mileage allowance and company car figures apply HMRC's published rates to the miles or list price shown. We will update this page if HMRC publishes anything that changes these figures.
See What Your Own Car Costs After the Budget
Enter a reg for its free report: road tax band, fuel cost, MOT history and recorded mileage. Buying one? The full history check (outstanding finance, write-off, stolen) is £4.99.
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