A guide to the UK’s electric car grant scheme expansion

Changes to the Expensive Car Supplement for EVs

The Expensive Car Supplement (ECS) is an additional Vehicle Excise Duty (VED) charge applied to cars with a high list price. It’s added on top of the standard annual road tax for the first five years after a vehicle is registered. The idea is to ensure that drivers of higher-value cars contribute more in tax than those with lower-cost vehicles.

On 26 November 2025, it was announced that the ECS threshold would be raised from £40,000 to £50,000 for electric vehicles. The new threshold officially applies from 1 April 2026, but it also covers EVs first registered on or after 1 April 2025.

This means that if your electric car was registered after 1 April 2025 and its list price is £50,000 or less, you won’t have to pay the ECS (currently set at £425 per year), which would otherwise bring your total annual VED to £620.

The existing £40,000 ECS threshold will remain in place for all non-EVs, including plug-in hybrids (PHEVs).

Proposed changes to employee car ownership scheme: Delayed until 2030

In the 2025 Autumn Budget, Reeves also announced that planned changes to employee car ownership schemes (ECOS) have been pushed back to 2030.

An ECOS, commonly offered by manufacturers and dealers, allows employees to purchase new cars at heavily discounted prices with low monthly payments and little or no interest. After around six months or 6,000 miles, the car is typically sold back and replaced under the same terms.

The Government had previously planned to bring ECOS within benefit-in-kind (BIK) tax rules from 6 April 2026. This change has now been deferred until 6 April 2030 to give the sector more time to prepare.

Further investment in public charging infrastructure and electrification

The Budget also includes £200 million to strengthen the public charging network and expand access to home or on-street charging for households without driveways.

In addition, a further £1.5 billion is being allocated to the DRIVE35 fund to support research, innovation, and investment in electric vehicle technologies, helping to accelerate the transition to zero-emission vehicles (ZEVs).

Further investment in public charging infrastructure and electrification

Finally, the Government also plans to review the cost of public electric vehicle charging, following significant price increases reported across the industry in recent years.

The review is scheduled to begin in the first quarter of 2026, with findings due to be released in the third quarter.

According to Budget announcements, it will assess the impact of higher energy prices and other factors contributing to public charging costs, including the 20% VAT rate applied to public charging and National Grid connection charges - and will consider options to reduce costs for EV drivers.

Electric car grant eligibility criteria

It’s important to note that not every EV on the market will meet the requirements for the scheme. Both the vehicle and its manufacturer must meet specific technical, environmental, and pricing standards.

	Requirement
Vehicle type	Passenger car (category M1) producing 0 g/km CO₂.
Electric range	Minimum 100 miles (160 km) on a charge.
Warranty	Minimum 3 years/60,000 miles (vehicle) and 8 years/100,000 miles (battery).
Price cap	£37,000 list price limit, with interpolation flexibility (see below).
Sustainability	The carmaker must provide evidence about the sustainability of vehicle manufacturing.
Approval process	Vehicle variant must be approved and listed on the OZEV (Office for Zero Emission Vehicles) grant portal.

 

The £37k price cap and the ‘interpolation family’ rule

To qualify for the scheme, an EV’s recommended retail price (RRP) must not exceed £37,000 (before options, delivery, or registration).

However, the Government allows a small margin through the ‘interpolation family’ system, where several variants of the same model may share eligibility, if the higher trims are technically identical to the approved core model.

Some higher-spec variants can still qualify this way, although the list price must not exceed £42,000.

Band 1 vs Band 2 discounts

The UK electric car scheme expansion introduced two grants, divided into two environmental performance bands:

	Discount	Which models qualify?
Band 1	£3,750	Models with top-tier sustainability and low lifecycle carbon emissions.
Band 2	£1,500	Models meeting the minimum zero-emission and efficiency standards.

 

Tips for checking EV grant eligibility

1. Whilst other media sources can be helpful, you should always double-check the GOV.UK website - or ask the dealer at the point of sale.
2. Eligibility is often variant-specific (e.g. trim, battery, and options). Always ask the dealer: “Is this model listed in the OZEV grant portal and which band is it in?” Dealers claim via the plug-in vehicle grant portal.
3. If you see a car listed as eligible in the press, cross-check with the official list of eligible models - and get confirmation of the discount in writing before agreeing to buy.

Brands offering pre-grant discounts

Some manufacturers have launched their own discounts to bring EVs under the £37k limit and attract more buyers.

Citroën, Vauxhall, and Peugeot have adjusted pricing, so that certain popular models fit grant eligibility. For example, Citroën’s ë-C3 now starts from £20,595 after the grant, and Vauxhall offers extra savings and deposit contributions on its electric range.

Some dealers are also advertising extra savings to match or supplement the Band 2 discount, but these are retailer initiatives, not part of the Government scheme.

When comparing offers, always check whether a saving is an official Government grant, a manufacturer promotion, or a dealer discount - and whether they can be combined.

If you see a car listed as eligible in the press, cross-check with the official list of eligible models - and get confirmation of the discount in writing before agreeing to buy.

EV chargepoint grants

Alongside the car grant, there are several EV chargepoint grants to help fund home, workplace, and fleet installations.

	What you can get	Who qualifies
Home chargepoint grant	Up to £350 or 75% of cost, whichever is lower.	Renters and flat owners with private parking – and property owners and renters with only on-street parking.
Landlord grant	Up to 75% off wider installation costs (max £30,000), including wiring for future sockets.	Landlords. Visit the GOV.UK website to learn more.
Depot charging scheme	Up to 75% of installation costs (max £1 million per organisation) for depot charging infrastructure.	UK fleet operators. Visit the GOV.UK website to learn more.

 

Which Motability cars are eligible for the new EV grants?

Motability customers can also benefit from the electric car grant if their chosen vehicle meets the same price, range, and zero-emission criteria as retail buyers.

However, many adapted or premium EVs exceed the price limit – and not all Motability cars qualify. So, check directly with Motability Operations or your chosen dealership before ordering.

Other electric car rollout incentives

Beyond the grant, EV owners also benefit from several tax and cost-saving advantages:

• Vehicle Excise Duty (VED): The first-year road tax on zero-emission cars is lower than hybrid, petrol, and diesel equivalents.
• Benefit-in-Kind (BiK): Lower company-car tax rates are available for EVs and salary-sacrifice schemes. Visit our car tax guide to see the current VED and BiK tax rates.
• Cheaper running costs: EVs are typically cheaper to run than traditionally fuelled vehicles.
• Local incentives: EV drivers often benefit from free travel within emissions-based zones. Free or discounted parking is also available at some public charging locations.
• Congestion Charge exemption: EVs are exempt from London’s Congestion Charge until 25th December 2025.

Frequently asked questions

What happens if I ordered a car before the grant was announced?

If you ordered your car before its variant was officially approved, it might not automatically qualify for the grant. Only cars registered under the Government’s EV grant scheme are eligible.

Manufacturers and dealers can choose to honour equivalent discounts, but this isn’t guaranteed, so it’s best to confirm in writing.

• Renault: Only orders that show the grant deduction on the invoice are eligible.
• Nissan: Will review requests case by case for customers who already ordered but still want to claim the grant.
• Citroën: Orders placed before 16 July aren’t eligible. Customers can cancel and reorder to qualify, but the original pricing or finance terms may not apply.

How do I make the most of the electric car grant scheme?

• Confirm your variant’s eligibility before you buy.
• Check whether it’s Band 1 (£3,750) or Band 2 (£1,500).
• Combine with charger grants and tax perks for maximum savings.
• Keep an eye on GOV.UK updates. New eligible models are added frequently.