Luxury car tax on cars over £40,000

rainbow143

I'm seeking advice on the Luxury Car Tax for vehicles exceeding £40,000.  
If the list price is under £40k, but with added extras it pushes the price over £40k, does it then mean the added car tax is payable?
I found this in WhatCar.
'It’s important to note that it applies to the total list price of the car, so it will include any optional extras added to a sub-£40k car.'

The Government site says - 
'The list price is the published price of the vehicle before it’s registered for the first time. It’s the price before any discounts are applied.'

I am looking at a car with a list price of £39,400, but the extras push the price I'm paying to £42k.
The dealership has advised me that this car will not be liable for the increased road tax as the original list price is under £40k, but I'd like some reassurance, please.

Many thanks.

rsvtoddy

What Car is right and the dealer is wrong!

Mr.Generous

rsvtoddy said:

What Car is right and the dealer is wrong!

He is correct. 6 years of at least £620 

sheslookinhot

Mr.Generous said:

rsvtoddy said:

What Car is right and the dealer is wrong!

He is correct. 6 years of at least £620 

The luxury car tax is payable for 5 years. (years 2-6). The first year is paid at standard rate.

Herzlos

With extras the list price is £42k, so you'd pay the higher rate. 

What it means is that if it's got a list price above £40k, you pay the higher rate even if the dealer discounts it under that threshold. 

Keep_pedalling

If the extras are factory fitted then yes the tax applies, but if dealer fitted it does not. So adding a factory fitted tow bar could take you into LT, but having one fitted by the dealer won’t. 

Goudy

sheslookinhot said:

Mr.Generous said:

rsvtoddy said:

What Car is right and the dealer is wrong!

He is correct. 6 years of at least £620 

The luxury car tax is payable for 5 years. (years 2-6). The first year is paid at standard rate.

The first year tax is paid at a rate set against CO2 emissions.
Anywhere from £10 for 0g/km to £5490 for vehicles over 225g/km.
This is paid at the time the vehicle is registered.

Then for year two a standard rate is paid (currently £195) but cars with a list price over £40,000 will pay an extra £425  (£425+£195= £620) a year for year two, three, four, five and six. (you pay up front for each year)

This means for year seven (when the car is six years old) it will revert to the flat rate (whatever that is at the time).

sheslookinhot

Goudy said:

sheslookinhot said:

Mr.Generous said:

rsvtoddy said:

What Car is right and the dealer is wrong!

He is correct. 6 years of at least £620 

The luxury car tax is payable for 5 years. (years 2-6). The first year is paid at standard rate.

The first year tax is paid at a rate set against CO2 emissions.
Anywhere from £10 for 0g/km to £5490 for vehicles over 225g/km.
This is paid at the time the vehicle is registered.

Then for year two a standard rate is paid (currently £195) but cars with a list price over £40,000 will pay an extra £425  (£425+£195= £620) a year for year two, three, four, five and six. (you pay up front for each year)

This means for year seven (when the car is six years old) it will revert to the flat rate (whatever that is at the time).

That was like I said. Why did you quote me ?

Goudy

You wrote the first year was a standard rate which gave the impression that rate is what is currently set at £195.

The first year is a variable rate based on the vehicles emissions.
After which the vehicle pays a standard rate from then on (either with or without the extra supplement for vehicles over £40k)

rainbow143

Can I ask a further question please.
If I buy a car now, that was registered before April 1st 2025 and the list price was over £40000, what is the position regarding the Luxury Road Tax.   Would that be £195 each year.  Feeling nervous about my future position.
Many thanks to all contributors.

Mildly_Miffed

rainbow143 said:

Can I ask a further question please.
If I buy a car now, that was registered before April 1st 2025 and the list price was over £40000, what is the position regarding the Luxury Road Tax.   Would that be £195 each year.  Feeling nervous about my future position.
Many thanks to all contributors.

https://www.gov.uk/vehicle-tax-rate-tables

Is it a ZEV, battery electric? If so, then the £425 isn't payable.
If it isn't, then it is payable.

You can see if any given vehicle is liable, and when until, by putting the plate into...
https://vehicleenquiry.service.gov.uk/
If it is, there will be a line at the bottom reading:
"Additional Rate applicable until <date>"
If you buy tax on or before that date, you pay the extra, if you buy it the first day after, you do not.