Budget 2027 - VRT on Electric Vehicles

Transport and vehicle taxation also featured in Budget 2027, with measures covering electric vehicle incentives and the VRT treatment of vehicles across different emissions bands. Our experts explain what was announced and the implications for the years ahead.

BUDGET 2027 HIGHLIGHTS

The Vehicle Registration Tax (VRT) relief for electric vehicles (EVs), which was due to end on 31 December 2026, is being extended for two years to end 2028.

From 1 January 2027, the Category A Vehicle Registration Tax percentage rates, used to calculate the CO2 component of the charge, are being increased. The percentage rates applicable to bands 3 to 20 inclusive (cars with CO2 emissions of more than 80g/km and upwards) are being increased by 1 per cent. The rates applicable to bands 1 and 2 will remain unchanged.

Explore BDO’s full Budget 2027 coverage

If you have any queries or would like to discuss the practical implications of these changes, our team is here to help.
You can contact us directly or read more of our Budget 2027 coverage.

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