The UK road tax system is set to change, following Chancellor Alistair Darling’s 2008 budget announcement.
The shake-up means that working out how much road tax you're likely to pay is set to get confusing.
The number of tax bands will increase from seven to 13 next year, with increased penalties for the most polluting cars, followed by further changes in April 2010.
Greener drivers are rewarded with lower tax bills, but owners of high-emission cars will be hit hard.
Here’s how the road tax changes will affect you over the next two years…
Whereas car tax on all models registered before 1st March 2001 is based on engine size, cars registered on or after that date are taxed according to their emissions.
So, for older cars, there’s one rate for engines smaller than and including 1549cc and one for engine sizes larger than 1549cc.
With newer models, annual car tax rates are based on cars’ green credentials and currently there are seven tax bands. Cars in band A are greener (and therefore cheaper to tax) than band G.
Essentially, the lower the emissions, the cheaper the tax disc.
You can find your car’s emission information in the log book (also called a V5 document) or in our facts and figures section.
The new road tax rules will come into force in two stages from March 2009-April 2010
In March 2009 the number of tax bands will increase from seven to 13 categories and range from bands A to M.
Road tax costs will be calculated as follows:
Road tax from April 2009
Tax band
CO2 emissions (g/km)
Annual rate
A
Up to 100
FREE
B
101-110
£20
C
111-120
£30
D
121-130
£90
E
131-140
£110
F
141-150
£120
G
151-160
£150
H
161-170
£175
I
171-180
£205
J
181-200
£260
K
201-225
£300
L
226-255
£415
M
Over 255
£440
In April 2010, tax disc rates will rise, with higher emission cars costing up to £15 more to tax.
All cars emitting less than 100g/km CO2 are tax exempt.
Buyers of newly registered, polluting models must also pay a one-off first-year tax – which could cost as much as £950 – while eco-friendly drivers are gifted tax exemption instead.
This could be a very costly tax for some UK drivers.
The first-year tax badly affects owners of cars emitting more than 161g/km CO2, with tax band M cars being stung with the maximum £950 fee.
Owners of new cars releasing less than 130/gkm CO2 do not have to pay road tax in the first year.
It can be very difficult to work out how much your next few tax discs will cost.
The road tax system is complex. Tax bands and rates will change next April and Government websites are tricky to understand.
Let Parker’s road tax calculator figure it out for you.
All you have to do is tell us what car you drive and we’ll do the hard work. Our helpful tool is quick and easy to use, working out how much tax you must pay now, next year and in 2010. It even breaks rates down into half-year and annual payments and adds the 2010 first-year registration fee on for you.
How much will you pay? Try Parker's road tax calculator
