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 Summary of RFL changes

 

Background

  • Changes only apply to vehicles registered on or after the 1st April 2017 and all vehicles registered before this date will be unaffected.
  • Changes are intended to make RFL costs fairer for motorists by ensuring that those who can afford a ‘premium’ vehicle pay more.
  • Changes are intended to be cost neutral from a government perspective.

 

What is changing?

  • The existing methodology for calculating RFL charges is being replaced with a new system aiming to make costs fairer for motorists.
  • The first licence rate will continue to be based on CO2 emissions, but the bandings are changing.
  • A standard rate of £140 will apply to all cars from the second licence onwards, with the exception of vehicles with zero CO2 where the standard rate will be £0.
  • An additional charge of £310 per year will apply from the second licence for a period of 5 years for any car with a ‘RFL List Price’ over £40,000. After 5 years the RFL will revert back to the standard rate.
  • Cars with an ‘RFL List Price’ over £40,000 but which emit zero CO2 will still have to pay the £310 additional rate for a period of 5 years from the second licence, but will revert back to the £0 rate after 5 years.
  • Alternative Fuel cars will continue to receive a £10 reduction on RFL rates.

 

What is included in the ‘RFL List Price’?

  • Manufacturer List Price including VAT as at the day before the vehicle is first registered.
  • Option prices including VAT applicable as at the day before the vehicle is first registered (as fitted by the manufacturer)
  • Delivery charges including VAT, including an pre-delivery inspection charges (where applicable)
  • For electric vehicles, the RFL List Price is calculated before any OLEV grant is applied.

What is not included in the ‘RFL List Price’?

  • First Registration Fee and the cost of the first licence.
  • Warranty/insurance and servicing packages
  • Options fitted by the dealer or another third party.
  • Modifications such as police packs or fire engine/ambulance modifications
  • Modifications for disabled drivers

 

RFL costs under the existing regime for this year are as follows…

 

 

 

 

VED Band

CO2 Emissions (g/km)

2016/17 First Year Rate *

2016/17 Standard Rate *

A

Up to 100

£0

£0

B

101 - 110

£0

£20

C

111 - 120

£0

£30

D

121 - 130

£0

£110

E

131 - 140

£130

£130

F

141 - 150

£145

£145

G

151 - 165

£185

£185

H

166 - 175

£300

£210

I

176 - 185

£355

£230

J

186 - 200

£500

£270

K

201 - 225

£650

£295

L

226 - 255

£885

£500

M

255+

£1,120

£515

 

 

 

 

*Alternative fuel discount of £10 on all qualifying cars

 

 

 

Cars registered on/after 1st April 2017 will be subject to the new RFL regime as shown in the table below…

 

 

 

 

 

 

 

 

 

 

CO2 Emissions (g/km)

First Year Rate *

Standard Rate  " *

 

 

 

 

 

0

£0

£0

 

 

 

 

 

1 - 50

£10

£140

 

 

 

 

 

51 - 75

£25

£140

 

 

 

 

 

76 - 90

£100

£140

 

 

 

 

 

91 - 100

£120

£140

 

 

 

 

 

101 - 110

£140

£140

 

 

 

 

 

111 - 130

£160

£140

 

 

 

 

 

131 - 150

£200

£140

 

 

 

 

 

151 - 170

£500

£140

 

 

 

 

 

171 - 190

£800

£140

 

 

 

 

 

191 - 225

£1,200

£140

 

 

 

 

 

226 - 255

£1,700

£140

 

 

 

 

 

Over 255

£2,000

£140

 

 

 

 

 

 

 

 

 

 

 

 

 

" Cars costing over £40,000 pay £310 additional rate for 5 years

 

 

 

 

 

*Alternative fuel discount of £10 on all qualifying cars