2016 Mitsubishi Outlander PHEV

Last Chance to Register a Tax Free Plug-in Hybrid (PHEV)

In just a few weeks time there will be a big change in the car tax (‘vehicle excise duty’ or VED) arrangements for plug-in hybrid electric vehicles (PHEVs) such as the Mitsubishi Outlander PHEV; here’s a brief summary.

The government has changed the basis on how the tax rates for cars are calculated – previously it was just on carbon dioxide emissions, so many low emission vehicles (such as small cars and all PHEVs) had no tax to pay. Now all cars with emissions that are non-zero, so all cars that aren’t 100% electric, have to pay tax. In the first year the amount depends on the level of emissions; in subsequent years it is £140 across the board.

Mitsubishi Outlander PHEV 4x4
Mitsubishi Outlander PHEV 4×4

The most popular plug-in hybrid in the UK is the Mitsubishi Outlander PHEV so it will be most affected. However, there remains just enough time to buy one from stock and get it registered before the deadline. In this case it gets free car tax for life; if registered after the deadline it pays tax for life.

Furthermore, there is an additional tax element for cars with a value over £40000; this is know as the ‘Premium Rate’ and adds an additional £620 over three years. Top-end Outlanders, typically above the GX4h spec, would get hit with this on top.

For more details see the Car tax 2017 article on the Next Green Car site.

Edit 22/3/17: Having looked into this a little further, I think NextGreenCar may have made a mistake. They are considering PHEVs to be petrol whereas they should probably be considered to be Alternative Fuel Vehicles which include hybrids (though in what sense any car running 100% on fossil fuels can be considered ‘alternative fuel’ beats me). Anyway, if so, the first year cost would be £0 rather than £10 and the follow-on years would cost £130 not £140. The overall message, however, is unchanged. The official guidance is here: Vehicle tax rate tables.

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