EV tax changes: what drivers need to know

A new survey has revealed that nearly half of Brits (45%) are unaware of major electric vehicle (EV) tax changes coming into effect this April.

Currently, EV owners benefit from Vehicle Excise Duty (VED) exemption, but from April 2025, all EVs will be subject to the same tax rates as petrol and diesel cars, costing owners around £195 per year.

With just under 1.4 million fully electric cars on UK roads, this means approximately 630,000 EV owners could be caught off guard by the additional costs.

The discovery comes from our recent survey of thousands of British drivers!

High costs holding drivers back from going electric

The government is pushing for greater EV adoption, but cost remains a key concern for many drivers, according to the recent survey.

Over a third (34%) of Brits say the high purchase price of EVs is the biggest barrier stopping them from making the switch in 2025.

Charging infrastructure is another key concern, with nearly one in five (18%) worried about the limited availability of charging points. 

Older drivers remain sceptical to EVs

The survey highlights differences in attitudes across age groups and locations.

Older drivers appear to be the most sceptical, with 55–64-year-olds particularly vocal about the challenges of EV ownership. Meanwhile, some regions are more resistant than others when it comes to embracing electric cars.

A 55–64-year-old administrator from Newcastle shared their concerns: "The cost of electricity, lack of charging facilities away from home, and the high price of electric cars make them unrealistic. Plus, the batteries don't last very long."

A 65+ secretary from Edinburgh echoed this sentiment, saying: "I think it's a bad idea switching to electric. They're not suitable for cold countries or places like the north of Scotland."

Meanwhile, a 55–64-year-old teacher from Norwich highlighted the challenges for disabled drivers: "It's virtually impossible for many disabled people to cope with hauling charging cables between chargers and cars."

How to save before the new rules kick in

Until now, one of the biggest benefits of owning an electric vehicle has been the financial incentives, particularly VED exemption. However, from April 2025, EV drivers will be required to pay car tax just like petrol and diesel drivers, which is typically around £195 per year.

However, if you renew your vehicle tax before April 2025, you could extend your exemption for another year, meaning you won’t have to pay until March 2026. You can re-tax your vehicle at any time through the government website using your registration number and the reference on your V5C log book. 

The upcoming EV tax changes could take many drivers by surprise, as our survey shows that nearly half of Brits are completely unaware of them.

While EVs offer long-term savings on fuel and maintenance, the high upfront cost remains a significant barrier. It's also clear that charging infrastructure and concerns around battery life are still making some motorists hesitant about making the switch.

For those considering an EV, it's important to research all the financial aspects, including tax changes, running costs and available grants, before making a decision.

If you're thinking about making the switch to an electric vehicle, now is the perfect time to explore your financing options - check out our 'Electric car finance' page to learn more or get a quote to start your journey towards a greener ride!

Information includes references to: 

GOV.UK - Vehicle tax for electric, zero or low emission vehicles

Zapmap - EV market stats 2025

Methodology: 

Survey of 2,000 UK adults, conducted in January 2025