Car Tax Bands Explained

February 23, 2012

Like income tax brackets in the US, car tax bands in the UK determine the amount of tax you'll have to pay on your car.

Detail Of Road Tax Disc

If you live in the United Kingdom, car tax bands should be kept in mind any time you plan to purchase a vehicle that you'll drive on public roads. Car tax laws mandate that all vehicles that are registered for public driving display a tax band prominently in the vehicle.

The Tax Band Shows Registration for Driving Tax
This tax band helps to identify the vehicle and to show that you've, in fact, prepared to pay taxes on that car. You can use a car tax band calculator in order to determine exactly how much you'll have to pay in taxes. Generally speaking, however, cars that pollute more are taxed more highly. Read on for more information about tax bands on cars in the United Kingdom.

Exempt Cars
If your vehicle was registered before the first of January in the year 1973, the car is exempt from taxation whatsoever. This is because the car is considered to be a vintage vehicle. You will not need to pay any taxes on the car, although you will need to display a tax band for the vehicle indicating its status as a tax exempt car on the public road.

Vehicles from 1973 to 2001
Any vehicle that was registered from 1973 up through March of 2001 will face a certain set of taxation requirements. In these cases, the tax per year for the vehicle is calculated according to engine size. If your vehicle has an engine that's smaller than 1549 cc, you'll have to pay 115 pounds per year. If the engine is larger than 1549 cc, you'll owe 180 pounds per year in taxes for the car.

13 Ways That Car Tax Bands Are Categorized
In the United Kingdom, the amount of car tax payable depends on the car tax bands assigned to different vehicles. In 2001, the government of the United Kingdom introduced Carbon Dioxide emission based car taxes, to promote the use of environmental friendly cars. In 2009, the Vehicle Excise Duty was restructured, and currently there are 13 categories of UK car tax bands. Car tax charges are based on the amount of Carbon Dioxide (CO2) emitted by the car, the age of the vehicle and the size of its engine. Apart from this, car tax has to be paid in order to obtain the vehicle license and a valid tax disc must be displayed on the front window as proof of payment.

An individual band exists for each letter of the alphabet from A to M. A unique letter band also exists for each vehicle vehicle of a different fuel type. A 12 month rate for an alternative fuel vehicle emitting 121 to 130 g of CO2 per km is not the same as the 12 month rate for a diesel vehicle emitting 121 to 130 g/km CO2 emission.

To check the up to date figures for the cost of individual bands, and what g/km CO2 emissions go with each particular bands, visit this Directgov page.

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