Answers · UK 2025/26
What is the expensive-car supplement on electric cars in 2026/27?
It is an extra Vehicle Excise Duty charge of £440 a year for five years, paid on top of the standard £200 rate, for cars with a high list price. For electric cars the threshold is £50,000, compared with £40,000 for petrol and diesel. The supplement runs from years two to six.
Full answer
The expensive-car supplement, sometimes called the premium or luxury-car tax, is an additional amount of Vehicle Excise Duty charged on cars with a high original list price. For 2026/27 it adds £440 a year on top of the standard £200 VED rate, so an affected car pays £640 a year in total. The supplement is charged for five years, beginning when the second-year standard rate starts and ending after the sixth year, after which the car reverts to the £200 standard rate. The key figure is the list price threshold. For petrol and diesel cars the supplement applies if the list price was over £40,000. For electric cars, which only became liable for VED at all from April 2025, the threshold is higher at £50,000, giving electric vehicles a slightly more generous concession. The list price used is the published price when the car was new, including factory-fitted options and VAT, not the discounted price you actually paid, so a car can fall over the threshold even if you negotiated a lower deal. This catches many mid-range electric models that breach £50,000 once options are added. Because the supplement is fixed at £440 regardless of how much over the threshold the car is, a £50,500 EV and an £80,000 EV pay exactly the same supplement. If you are choosing between two similar electric cars where one is just over £50,000, keeping the list price under the threshold can save you £2,200 over five years. Use a car cost calculator to factor the supplement into your total ownership costs.
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This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.