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What Is The April 2020 Road Tax Increase (VED) And How Will It Affect You?

From 1st April 2020, Vehicle Excess Duty (Road Tax) will be increasing, which means buying a new car in April will be more expensive than buying one in March. 

Luckily, Stockton Kia has some exclusive March offers that save you a pretty penny on top of your road tax saving!

With 0% finance available on selected models in the Kia range, plus savings of up to £4,300 on a brand new Kia, you really don't want to miss out this March!

 

One way of beating the tax increase is by knowing exactly what it is and why it's happening in the first place. Here's everything you need to know about the road tax changes.

If you’re a driver in the UK, you’ll know that you have to pay for something called Vehicle Excise Duty or a road fund license (commonly called car tax or road tax). The amount you pay will depend on factors such as engine size, fuel type and the amount of CO2 emissions your vehicle generates at the time it is first registered. 

You can now understand why diesel car owners usually have to pay a higher rate of VED than petrol users, and why electric vehicle owners are exempt from paying car road tax entirely. In simple terms, the lower your CO2 emissions are, the lower the rate of your vehicle excise duty.

Previously, this was measured through the New European Driving Cycle test (NEDC) which was first developed in the 90s and last updated in 1997. However, with the rise in advanced technology in the last decade, NEDC testing has become outdated and is no longer truly representative of real-life driving.

Instead, a new method of testing called Worldwide Harmonised Light Vehicles Test Procedure (WLTP) replaces it. The upcoming WLTP method is able to determine a more realistic evaluation of your vehicle’s official fuel consumption (mpg), driving range and CO2 emissions (g/km).

As a result, your vehicle’s CO2 emission output will change, placing it in a higher tax band to its current rate, causing an increase in the cost of your road fund license for the first year. 

Using the table below, you will be able to calculate which tax band your vehicle would be in if you were to buy it after 1st April 2020:

VED Band CO2 Emissions (g/km) First Year Rate First Year Rate for non-RDE2 Diesels  Alternative Fuel Vehicles 

A

0

£0

£0

£0

B

1-50

£10

£25

£0

C

51-75

£25

£110

£15

D

76-90

£110

£130

£100

E

91-100

£130

£150

£120

F

101-110

£150

£170

£140

G

111-130

£170

£210

£160

H

131-150

£210

£530

£200

I

151-170

£530

£855

£520

J

171-190

£855

£1,280

£845

K

191-225

£1,280

£1,815

£1,270

L

226-255

£1,815

£2,135

£1,805

M

Over 255

£2,135

£2,135

£2,125

Finance subject to status. You will not own the car until all payments are made. Guarantees/indemnities may be required. Stockton Kia act as a credit broker with finance supplied by Kia Motors Finance RH1 1SR. Applicants must be 18 years or over. Terms and conditions apply. At the end of the personal contract purchase there are three options (i) Renew: part exchange the vehicle, where equity is available (ii) Retain: pay the GFV(Guaranteed future value) to own the vehicle (iii) Return the vehicle, further charges may be made subject to the condition of the vehicle. ††Excess mileage will be charged at a rate of 9p per mile for the first 5,000 miles and at twice that rate thereafter We can introduce you to a number of carefully selected finance providers. We may receive a commission from them for the introduction. †Kia Warranty: 7 Year/100,000 mile manufacturer’s warranty. Manufacturer’s terms and conditions apply.This offer supersedes any previously advertised offers/discounts. Retail customers only. Subject to availability. Model year restrictions may apply. Offer ends 31 March 2020. E&OE.