We can provide finance for people who have had difficulties obtaining credit in the past,
if we can’t approve you, we don’t think anyone can!

The New VED Road Tax And How it Affects You

Posted on 20/01/2017

Vehicle Excise Duty (VED) is a road tax that is enforced onto most types of vehicles that are being used on roads in the UK. Tax rates are based on engine size or fuel type and the amount of CO2 that is produced from your vehicle. The government have introduced new changes to road tax that are coming into force in April 2017.

Emissions are measured by how many grams are emitted from the exhaust of your car over every kilometre (km) travelled. Under the current VED, almost no new cars are paying any tax which is costing the treasury millions. This is because modern engines and vehicles have improved vastly so many regular cars are now emitting lower CO2 emissions and falling into the tax free bracket. The lowest band was originally intended to include electric, hybrid and low emission cars but as technology has improved, more and more vehicles are falling into the lowest band. Car makers have worked to reduce CO2 emissions to take advantage of generous tax bands for lower emission vehicles.

Under new regulations, only electric and hydrogen cars are exempt from road tax in a bid to encourage more people to opt for eco-friendly cars. Despite this, the new VED rates will still be charging the most polluting electric and hybrid cars on the roads.

What are the changes?

Road tax band table

These changes are only applicable to cars registered after April 2017 so current cars will continue to operate on the old tariff. As before, tax is no longer transferrable between owners, so if you sell your car, the new owner will have to tax it. If you have any remaining tax left on the vehicle, you can claim it back from the government.

Cars registered after the 1st April 2017 that cost less than £40,000 will pay a charge for the first year determined on CO2 emissions and for every year after a flat rate of £140.

Cars that cost more than £40,000 will have to pay an additional annual ‘premium fee’ of £310 for the following 4 years after the first year. It is important to note that the £40,000 threshold is set by the final price of the car so any extras that you add on that increase the price over the threshold you will have to pay the higher rate.

How much more will I have to pay?

Those hit the worst will be drivers of low emission’s cars who will now have to pay £140 per year after the one off charge in the first year. If you are thinking of buying a new car this year, do your calculations to work out if you would be better off buying your car before the changes or after.

Which cars are better or worse off?

BMW 5 Series

BMW 530D SE Auto
CO2: 134g/km
VED rate over 6 years: £2,450
£1,670 more expensive compared to 2015 VED rate

VW Golf

Volkswagen Golf Match Edition Bluemotion 1.0 TSI
CO2: 99g/km
VED rate over 6 years: £820
£820 more expensive than current VED rate


Black Lexus F Sport

Lexus GS300h F Sport
CO2: 115g/km
VED rate over 6 years: £2,410
£2,310 more expensive than current VED rate

White Nissan 370z

Nissan 370Z
CO2: 245g/km
VED rate over 6 years £3,000
£2,160 less expensive than current VED rate

The new bands were set out to tackle the advances in technology and encourage people to opt for cars that run on electric or hydrogen only. What do you think of the new road tax? Let us know on Facebook!

Registered with Information Commissioners Office ICO Registration Number: ZA132327

UK Car Finance Limited. Registered in England
Registered number 9397657.
Registered Office Lakeside House, 30 Northumbrian Way, Newcastle Upon Tyne, NE12 6EH

Refused Car Finance is a trading style of UK Car Finance Limited and is acting as a licensed credit broker and a lender, we are authorised and regulated by the Financial Conduct Authority, registration number 714966. All finance is subject to status and income. Applicants must be 18 or over, terms and conditions apply, guarantees and indemnities may be required.

Written quotations on request. Certain exclusions for NI residents.

Note: We cannot be held responsible for specification errors, and price errors, we use Motortrade software which is not always 100% accurate. Copyright 2017 Refused Car Finance.

Refused Car Finance can introduce you to a limited number of finance providers based on your credit rating and we may receive a commission for such introductions.

*Representative Example
Cash price – £8,500.00, Deposit – £0.00, Amount of credit – £8,500.00, Rate of interest – 16.24% per annum, Amount of interest – £6,912.00, Lender Documentation fee – £0.00, Lenders option to purchase fee – £10.00, Total charge for credit – £6922.00, First repayment – £256.70, Followed by 58 Monthly repayments of – £256.70, Final repayment – £266.70, Total amount payable – £15,412.00, Representative APR – 29.9%

*Last month, over 51% of Refused Car Finance customers that had their loan arranged were offered an APR of 29.9% or lower

In the first 3 months of this year, UK Car Finance Ltd received 2140 unique applications, of which we were able to offer 2136 applicants a line of credit, subject to the applicant being able to provide acceptable proof of affordability, being free from insolvency and or/a supporting guarantor fitting the lenders eligibility criteria, this represented 99.8% of applicants in this period.

Rated No.1 for car finance in the North East of England collated from Google Business Reviews

Refused Car Finance Reviews

4.90 Average

146 Reviews

Was so fast and easy Jacob was even doing out of work search’s for me , he done more than his job he helped me find my car I wanted and pushed through for me to get it as soon as possible .

Refused Car Finance where awesome they kept me informed every step of the application they where so professional in every aspect. I highly recommend them to anyone with poor credit history and for people who are long term benefits.

Paige was very professional and very helpful. Highly recommend