Motability Question: Tax increase

Here’s what it actually looks like in real life costs and payments on Motability for an EV, based on how the scheme works now.

I’ll keep it practical rather than brochure-style.

On the Motability Scheme, you are not paying a normal “car finance bill”. Instead:

You give up your mobility allowance

• Around £80–£90 per week (higher-rate mobility element of PIP/DLA etc.)
• This goes straight to Motability

That covers:

• Car lease
• Insurance
• Servicing & maintenance
• Breakdown cover
• Tyres, repairs, etc.

So in simple terms:
👉 your allowance becomes your “car budget”

1. Weekly cost (the main one)

You still pay:

• Your normal mobility allowance (same as petrol cars)

So:

• No extra weekly charge just because it’s electric

2. Advance Payment (optional upfront cost)

This is where EVs differ:

• Some EVs = £0 Advance Payment
• Many EVs = £300–£3,000+ upfront

This is:

• Not monthly
• Not refundable
• Just a one-off contribution for higher-spec cars

Example:

• Kia EV3 → often low or moderate Advance Payment depending on trim

3. Charging costs (this is your only real “fuel bill”)

With your situation (driveway + low mileage):

100 miles/week ≈ 450 kWh/month-ish usage

Costs:

• ❌ Petrol car: ~£100/month fuel
• ⚡ EV home charging:
  • Off-peak tariff: ~£10–£25/month
  • Standard tariff: ~£25–£40/month

So your “fuel bill” drops massively.

4. Home charger (important Motability benefit)

For EVs:

• Motability usually includes a standard home chargepoint installation if you qualify

So:

• You typically don’t pay for the charger itself
• Only for any “non-standard installation” if your driveway setup is unusual

5. Road tax (VED) — correct current situation

This is where confusion online happens:

• EVs are no longer £0 tax permanently
• They now pay standard VED from new rules (around £190/year equivalent after year 1)

BUT on Motability:

• You don’t directly deal with this
• It’s handled within the lease package

So practically:
👉 you won’t be paying road tax separately

6. What about the “3p per mile” thing?

The 3p per mile EV charge is a real policy change that has been announced and is planned for the future, not just speculation.

Here’s the accurate, up-to-date picture:

🚗 ✔ What is confirmed

The UK government has announced a new pay-per-mile system for EVs called eVED (Electric Vehicle Excise Duty):

• Start date: April 2028
• Rate:
  • 3p per mile for fully electric cars
  • 1.5p per mile for plug-in hybrids (GOV.UK)

So yes — the “3p per mile” figure is real and official.

💷 ✔ What it means in real money

At typical mileage:

• 8,000 miles/year → about £240 per year (carwow.co.uk)
• 10,000 miles/year → about £300 per year

That’s broadly designed to replace lost fuel duty as petrol/diesel use declines.

⚖️ ✔ Important context (this is the part most headlines miss)

Even after this change:

• EVs are still expected to be cheaper per mile than petrol cars overall
• Petrol already effectively pays around ~6p per mile in fuel duty alone
• So EVs still come out cheaper once electricity costs are included (GOV.UK)

🧠 ✔ What this means for YOU (Motability + your mileage)

For your situation:

• ~100 miles/week (~5,200 miles/year)
• driveway + home charging
• EV on Motability

Your future EV tax would be roughly:

👉 £150–£180 per year (from 2028 onwards)

That’s:

• about £12–£15 per month equivalent

And importantly:

• It does NOT change your Motability lease payment
• It is not an “extra EV penalty”
• It applies to all EV drivers, not just Motability users

⚠️ Key takeaway

• ✔ Yes — 3p/mile is coming (from 2028)
• ✔ It will increase running costs slightly
• ✔ But EVs still remain significantly cheaper than petrol overall
• ✔ For your mileage, the impact is relatively small (~£150/year)

🔎 Bottom line for your decision today

Even with this future tax included:

• Your EV running costs are still likely much lower than petrol
• Your biggest savings still come from:
  • no fuel bills
  • low servicing
  • home charging (especially off-peak)

Based on your usage:

Your situation

• 100 miles/week
• driveway
• 3 long trips per year

What you’d actually experience

• Weekly allowance covers lease
• Possibly £0–£1,000 upfront depending on car choice
• £10–£25/month electricity (if using cheap tariff)
• No servicing/MOT/insurance costs
• No road tax bill to manage

Compared to petrol:

With your mileage and driveway:

• EV is financially very strong on Motability
• Biggest cost saving is fuel + maintenance
• Tax changes are now minor compared to running costs
• Charging at home is what makes it work so well