New VED (Road Tax) 2018 – The Diesel Increase

The VED (Road Tax) for new diesel cars is changing.

The VED (Road Tax) for new diesel cars is changing. Under the current VED (Road Tax) system, issued in the Spring Budget of 2017, new cars registered after April 1st, 2017 pay a one-off tax charge for the first year based on their carbon emissions in a CO2-based tax band system.

From the 1st April 2018, new diesel cars will be subject to an increase in first-year VED rates if they don’t meet Euro 6 emissions standard in the laboratory and in real-world driving conditions. This means that diesel cars registered after 1 April 2018 and certified with real world NOx emissions figure greater than the RDE2 standard or without a certified NOx emissions figure will see their VED band in their First-Year Rate go up by one.

The changes being made apply to new diesel cars and don’t include vans or commercial vehicles, the increase in VED is only payable for models that don’t meet the latest Euro 6 emissions standards when tested on the real-world emissions regime that forms part of the current EU type approval process. There are currently no new diesel vehicles that conform to the current RDE standards, meaning that currently, any new diesel sold will be subject to the increase.

The Real World Emission standard (RDE2) was introduced in September 2017  and sets out the maximum permitted level of car NOx emissions in real world driving situations. It measures vehicle emissions using portable equipment in a range of real world driving. Vehicles have to pass the certified level of NOx emissions irrespective of the driving behaviour during the test – for example, the level of emissions produced when an engine is under stress, such as driving in rush hour traffic. Vehicle manufacturers will have to certify NOx emissions outputted and the certificate of conformity produced will record which Euro-standard the vehicle is certified to.

New diesel tax bands from April 2018 compared with current bands

Current VED VED from April 2018
Co2 Emissions (g/km) First Year Rate Standard Rate First Year Rate Non-Diesel First Year Rate Diesel Standard Rate All Fuel Types First Year Rate Diesel Increase
0 £0 £0 £0 £0 £0 £0
0-50 £10 £140 £10 £25 £140 £15
51-75 £25 £140 £25 £105 £140 £80
76-90 £100 £140 £105 £125 £140 £25
91-100 £120 £140 £125 £145 £140 £25
101-110 £140 £140 £145 £165 £140 £25
110-130 £160 £140 £165 £205 £140 £45
131-150 £200 £140 £205 £515 £140 £315
151-170 £500 £140 £515 £830 £140 £330
171-190 £800 £140 £830 £1,240 £140 £440
191-225 £1,200 £140 £1,240 £1,760 £140 £560
226-255 £1,700 £140 £1,760 £2,070 £140 £370
Over 255 £2,000 £140 £2,070 £2,070 £140 £70

It has to be noted that cars costing over £40,000 are also liable for the £140 VED rate from year two and owners will also be forced to pay an additional annual ‘supplement’ of £310 for five years, a total of £450 a year. Once the five-year period is over they revert to the £140 flat rate.

Should you have any questions regarding the VED changes or if you are simply looking to add a new vehicle to your fleet, get in touch today.

 

Posted on

Recent Articles


Adblue and Diesel Particulate Filters Explained

Diesel has featured in the press continually in recent months, with “Dieselgate”, The New VED (Road Tax) and Diesel Surcharge for Parking Permits. Nearly all the press has focused on the negative impacts of Diesel on the environment and the emission effects in towns and cities. Diesel can still, however, be the most economical and cost-effective fuel […]


Watch out for changing capital allowances

Most businesses can apply capital allowances as a form of tax relief for items they have bought for the purposes of business. Handily, this includes cars. So if your business buys a vehicle as a company car for an employee, then the car can be written down against taxable profits. There’s a general ‘pool’ for […]


Visit Archive