Petrol and diesel drivers hit with HMRC VAT rates | Tech News

Petrol and diesel drivers throughout the UK are being hit with new VAT rates following a 2026 replace by HM Revenue and Customs (HMRC).

The tax workplace has launched new VAT highway fuel scale prices from May 1, 2026, with the up to date rates to stay in power till April 30 2027, impacting hundreds of drivers. Road fuel scale prices are a fixed quantity authorized by HMRC which can be added to a VAT return to account for the non-public consumption of fuel in a business vehicle. These rates are up to date by HMRC as soon as per yr, with the new rates being confirmed on May 1, and the costs apply to autos based mostly on CO2 emissions.

Drivers account for these prices by together with them in Box 1 of VAT returns and the quantities are fixed irrespective of the quantity of non-public mileage you clock up.

HMRC stated drivers need to work out the right highway fuel charge based mostly on their car’s CO2 emissions and the size of their VAT accounting period, which shall be both one, three or 12 months.

The rates increase in bands of 5g per kilometre of CO2 emissions, with VAT-inclusive prices starting from £657 for autos emitting 120g or much less of CO2 per km, to £2,297 for autos emitting 225g/km for a 12-month period.

Drivers have the option of recovering the VAT in full and paying the highway fuel scale charge, not recovering any VAT in any respect, or monitoring the cut up between business and personal mileage to partially get well some VAT.

Confirming the new rates from May 1, 2026, till April 30, 2027, HMRC stated: “The VAT Road fuel scale charges are amended with effect from 1 May 2026. Businesses must use the new scales from the start of the next prescribed accounting period beginning on or after 1 May 2026.

“You’ll need to work out the right highway fuel charge, based mostly in your car’s CO2 emissions, and the size of your VAT accounting period. This shall be both one, 3, or 12 months.”

Listed are the new VAT road fuel scale charges that apply to drivers of petrol and diesel cars from May 1, 2026, to April 30, 2027, for a 12 month, three month and one month accounting period, as confirmed by HMRC:

CO₂ Emissions: 120g/km or less

• 12 Month Period: £657.00
• 3 Month Period: £163.00
• 1 Month Period: £54.00

CO₂ Emissions: 125g/km – 150g/km

• 125g/km: £983.00 (12 months) | £246.00 (3 months) | £81.00 (1 month)
• 130g/km: £1,051.00 (12 months) | £261.00 (3 months) | £86.00 (1 month)
• 135g/km: £1,114.00 (12 months) | £278.00 (3 months) | £92.00 (1 month)
• 140g/km: £1,182.00 (12 months) | £294.00 (3 months) | £98.00 (1 month)
• 145g/km: £1,245.00 (12 months) | £311.00 (3 months) | £103.00 (1 month)
• 150g/km: £1,314.00 (12 months) | £328.00 (3 months) | £109.00 (1 month)

CO₂ Emissions: 155g/km – 180g/km

• 155g/km: £1,377.00 (12 months) | £344.00 (3 months) | £114.00 (1 month)
• 160g/km: £1,445.00 (12 months) | £361.00 (3 months) | £119.00 (1 month)
• 165g/km: £1,508.00 (12 months) | £377.00 (3 months) | £125.00 (1 month)
• 170g/km: £1,576.00 (12 months) | £393.00 (3 months) | £130.00 (1 month)
• 175g/km: £1,640.00 (12 months) | £409.00 (3 months) | £136.00 (1 month)
• 180g/km: £1,708.00 (12 months) | £426.00 (3 months) | £142.00 (1 month)

CO₂ Emissions: 185g/km – 220g/km

• 185g/km: £1,771.00 (12 months) | £442.00 (3 months) | £146.00 (1 month)
• 190g/km: £1,839.00 (12 months) | £459.00 (3 months) | £152.00 (1 month)
• 195g/km: £1,902.00 (12 months) | £475.00 (3 months) | £158.00 (1 month)
• 200g/km: £1,971.00 (12 months) | £492.00 (3 months | £163.00 (1 month)
• 205g/km: £2,034.00 (12 months) | £509.00 (3 months) | £169.00 (1 month)
• 210g/km: £2,102.00 (12 months) | £524.00 (3 months) | £174.00 (1 month)
• 215g/km: £2,165.00 (12 months) | £541.00 (3 months) | £180.00 (1 month)
• 220g/km: £2,233.00 (12 months) | £557.00 (3 months) | £185.00 (1 month)

CO₂ Emissions: 225g/km or more

• 12 Month Period: £2,297.00
• 3 Month Period: £574.00
• 1 Month Period: £190.00

For older cars without a CO2 emissions figure, the CO2 band is instead determined by the size of the engine.

HMRC stated: “If your car is too old to have a CO2 emissions figure, you should identify the CO2 band based on its engine size. If its cylinder capacity is:

• 1,400 or less, use CO2 band 140
• more than 1,400cc but less than 2,000cc, use CO2 band 175
• more than 2,000 cc, use CO2 band 225 or more

To do this, work out how much of the accounting period you used each car for, and record this as a percentage of the accounting period. Apply this percentage to each road fuel scale charge, to get a total figure.”