Vehicle tax reduction

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My vehicle tax has come in much lower than previous years.

Having looked into it it seems that cars over 40k when when new attract a charge of £390 a year extra tax for the first 5 years and mine has just gone over that age.

I didn't even know about that particular gouge. Nothing to do with CO2 or other emmissions.... just extra tax to pay because you have a more expensive car. Awesome.

That aside...as I understand it the current annual charge for a petrol car is £570, so taking that less the £390 would give £180....but my bill renewal has come in at £245.

Does anybody know why it would be £245 rather than £180 ?
 
Is your billing period part way through when the luxury tax gets removed?
 
A real sly and slippery tax given that £40k was never 'luxury', but 3 years of inflation has dragged any half decent car larger engined car into it now..

Still as officially now an OAP I can't complain as someone has to pay for the triple lock
 
Duvetday said:
Does anybody know why it would be £245 rather than £180 ?
Click to expand...

Because you aren't eligible for a full year at the discounted rate. In my pre-full year it only went down about £30. Next year you'll pay the minimum. Enjoy it!
 
Makes sense...does the same thing happen with insurance ? :roll:
 
Just about the only thing that annoyed me about not being able to order an MY20 V6 car (Jag stopped taking orders just a few days before I tried to order one!) and 'having to settle' for the P450, was the £2000 first year - over £1K more than the V6 would have cost me. By the time the luxury uplift ends, I'll have stumped up nearly £4500 just in road fund license fees! A small price to pay for the enormous privilege it is to own this car and spec it exactly as I wanted (within reason!)
 
The V5 document gives you the date the higher tax is payable to and I was surprised it wasn’t an exact number of years.
My car was first registered in October 2018 but V5 said higher tax payable to 31.12.23 - can anyone explain that?
 
I've just looked at my V5. Car registered in September 2019 and the higher VED is payable until 28/02/2025. Which is four months shorter than I was expecting, if this is correct.

The only thing I'm aware of, is that it was a showroom car and dealer demo for six months after registration. The first non trade owner (a company) bought it in March 2020, which ties in with the VED change at the end of February.
 
jagseven said:
The V5 document gives you the date the higher tax is payable to and I was surprised it wasn’t an exact number of years.
My car was first registered in October 2018 but V5 said higher tax payable to 31.12.23 - can anyone explain that?
Click to expand...

Given it seems to be an entitrely arbitrary tax I guess they are arbitrary with the dates too ?
 
Duvetday said:
jagseven said:
The V5 document gives you the date the higher tax is payable to and I was surprised it wasn’t an exact number of years.
My car was first registered in October 2018 but V5 said higher tax payable to 31.12.23 - can anyone explain that?
Click to expand...

Given it seems to be an entitrely arbitrary tax I guess they are arbitrary with the dates too ?
Click to expand...

I would assume it’s 5:years from date of second taxation, rather than registration.
 
Aha! Just read an article about this. The 'luxury' tax is payable for 5 years from the second time the car is taxed.

So assuming the car is taxed at first registration and then sold to the second owner before it's a year old, it then gets taxed a second time within the first year. (VED doesn't stay with the car and roll over nowadays).

😁 Nice surprise that when my VED comes up in July I'll be £130 better off than I was expecting!
 
Yes - that makes sense. My car was a pre-reg car registered in October 2018 but not sold to first owner until 3 months later in Jan 2019. So 5 years after that takes me to December 2023. So only 5 years and 3 months at the higher rate.

In contrast my F-Pace was a factory order and I see from my V5 that I will pay the higher rate of tax for the full 6 years.
 
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