Cars no longer liable for £425 charge as tax rules change – The Mirror
Need to know
The so-called ‘luxury vehicle tax’ – officially the Expensive Car Supplement – has a new £50,000 threshold from April 2026
Need to know: Car tax shake-up saves nearly 500,000 electric vehicle drivers £425 a year
Nearly half a million electric vehicle drivers will dodge a £425 annual luxury car tax from April 2026 after the Government raised the threshold from £40,000 to £50,000.
Research by motor group Dick Lovett reveals that 475,836 drivers will benefit from the tax change. Each will save £425 annually, totalling £2,125 over the five-year period the charge applies.
Electric vehicles were previously exempt from the so-called ‘luxury vehicle tax’ but EVs costing £40,000 or more registered after April 1, 2025, became liable for the extra charge. The threshold increase means drivers of popular models priced between £40,000 and £50,000 will now dodge this additional cost.
Specific examples include the BYD Sealion 7 Comfort at £46,990, which will no longer face the annual charge. BMW’s iX1 and iX2 lineups now sit beneath the luxury car tax threshold when specced as standard.
Alex Lee, motoring expert at Dick Lovett, said: “For those looking at electric cars between £40,000 and £50,000, drivers can now expect to save £2,125 over five years. This also means that drivers will have more choice when it comes to mid-range EVs.”
However, he warned that not all models will be exempt, adding: “It’s important for drivers to look into the specific car they are wanting to get to avoid any confusion.”
Drivers are advised to check individual vehicle prices carefully as some models within ranges may still exceed the new threshold.
READ THE FULL STORY: Cars no longer hit by ‘luxury vehicle tax’ include Audi, BMW, Skoda as new threshold takes effect
