How much extra Vehicle Excise Duty do I pay on a car over £40,000?

Full answer

Vehicle Excise Duty (VED, commonly called road tax) includes an "expensive car supplement" for vehicles with a list price above £40,000 when new, regardless of the price you actually paid or the car's current value. From April 2026, this supplement threshold also applies to zero-emission vehicles above £50,000, following the removal of the previous EV exemption. The supplement is £440 a year for 2026/27, charged in addition to the standard rate of £200 a year that applies to most petrol, diesel, hybrid and electric cars from the second year of registration onwards. This means a car with a list price over £40,000 costs £640 a year in VED (£200 standard plus £440 supplement) during years two to six of registration -- five years in total -- after which the supplement stops and only the standard £200 rate continues to apply for the rest of the car's life. The first year's VED rate is calculated differently, based on the car's CO2 emissions at first registration, and is separate from both the standard rate and the premium supplement. Because the £40,000 threshold is based on the manufacturer's list price before any discounts, many mid-range cars with popular options or trim levels can tip over the threshold even if the buyer negotiates a lower actual purchase price, making it worth checking the list price carefully before ordering optional extras that might push a car over the boundary.