Drivers face a car tax increase from £200 to £210 depending on their chosen payment method, according to the DVLA. From 1 April 2026, the standard tax rate for all petrol, diesel, or hybrid cars registered after 1 April 2017 will rise to £200. However, the RAC warns that paying in monthly instalments results in a higher total cost.
Payment Options and Costs
The RAC advises: "If you pay for six months tax, it'll cost £110, or £105 if you opt to set up a direct debit. If you pay in 12 monthly instalments your total car tax cost will be £210." By far the easiest way to pay for road tax is online, the RAC adds.
To tax your car online, you need a reference number from one of the following documents: a recent reminder (V11) ‘last chance’ warning letter from the DVLA, vehicle logbook (V5C) in your name, or a green new keeper supplement (V5C/2) from a logbook of a car you’ve just bought. The system is extremely straightforward, and you can pay via debit card, credit card, or direct debit.
Additional Charges and Alternative Methods
The RAC notes: "Additional charges may apply if you pay via direct debit." If you prefer not to pay online, you can telephone the DVLA’s 24-hour service on 0300 123 4321, although direct debit is not an option over the phone. Alternatively, for a more traditional approach, you can tax a vehicle at a Post Office that deals with vehicle tax.
Penalties for Untaxed Vehicles
If you are the registered keeper of an untaxed vehicle, you will receive a Late Licensing Penalty (LLP) letter. The fine is £80, but it can be reduced to £40 if you pay within 33 days. Failure to pay results in the case being referred to a debt collection agency. Anyone caught using or keeping an untaxed vehicle without a SORN (Statutory Off Road Notification) will be issued an Out of Court Settlement (OCS) letter. The OCS is set at £30 plus one-and-a-half times the outstanding vehicle tax rate.
