If the price of my car rises above £40k after I've ordered it do I have to pay premium tax?

I am about to order a new car with a list price just below £40K so no higher VED to pay. If during the time from ordering the car to it being delivered the list price increases to above the £40K limit will the car be subject to the additional VED for the next 5 years, or is the £40K based on the time at ordering?

Asked on 25 May 2023 by Andy Podmore

Answered by David Ross
Broadly speaking, the VED rate applies to the list price plus options of the vehicle at the time of purchase, so it depends on the terms of your order. If you have paperwork that shows a deposit has been paid and an agreed price that will not change then the list price at the time will apply, but if you have just put your name on a waiting list then the price may be affected by price changes. It would be wise to make this clear with the dealership when you place your order to ensure you are not subject to price changes.
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