VED changes - Expensive Car Supplement for EVs

From 1 April 2026, there will be an increase in the Vehicle Excise Duty Expensive Car Supplement threshold for zero emission cars. This change will impact rental and leasing members who purchase or own zero-emission cars with list prices over £40,000 and below £50,000.

These vehicles will no longer be required to pay the Expensive Car Supplement charge when they take out a licence, which comes into effect on or after 1 April 2026, and is not a first vehicle licence. The threshold will be maintained at its current level of £40,000 for all other cars.

The standard rate of VED for new EVs registered remains fixed at £10 until March 2030.

The standard rate of VED from the second year onwards will increase from £195 to £200 from 1 April 2026 until 31 March 2027. The Expensive Car Supplement is on top of the standard rate and was £425 in 2025, rising to £440 from 1 April 2026 to 31 March 2027.

A separate threshold in the Expensive Car Supplement for EVs has been an on-going ask in BVRLA's Budget Submissions and engagement with HM Treasury.

Expensive Car Supplement factsheet - Feb 2026 (PDF)