From 2026, the standard vehicle tax rate for cars registered after April 2017 will rise to £200 per year, affecting many drivers including those aged over 70. Additionally, the Expensive Car Supplement (ECS) for brand-new cars valued over £40,000 has increased to £440 annually.
While elderly drivers do not receive a specific tax concession based solely on age, exemptions and reductions are available for individuals in certain circumstances. Notably, pensioners receiving mobility allowances such as the higher rate of the Department for Work and Pensions (DWP) Disability Living Allowance (DLA) or Personal Independence Payment (PIP) can claim a 100% Vehicle Excise Duty (VED) exemption.
Historic vehicles, defined as those manufactured more than 40 years ago, qualify automatically for a tax exemption.
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According to the Driver and Vehicle Licensing Agency (DVLA): “You can get a vehicle tax exemption for one vehicle, if you’re eligible. The vehicle must be registered in the disabled person’s name or their nominated driver’s name. The vehicle must be used for a disabled person’s personal needs and cannot be used by the nominated driver for their own personal use.”
Exemptions from vehicle tax are available to those receiving any of the following seven DWP benefits. To claim the exemption, applicants must notify the DVLA when applying for vehicle tax. First-time applicants need to claim at a Post Office and must reapply for the exemption each time they change their vehicle.
Age UK has highlighted that while the standard car tax rate is increasing to £200 for vehicles registered after April 2017, cars registered between 1 March 2001 and 31 March 2017 may also see changes in tax, except those with emissions between 101 and 120g/km, which will not incur an increase.
Additionally, eligible individuals can receive a 50% reduction in vehicle tax on one vehicle under specific criteria, again requiring the vehicle to be registered in the disabled person’s or their nominated driver’s name.
Drivers affected are advised to check their eligibility and apply accordingly to benefit from any exemptions or reductions on vehicle tax.