Six new driving laws for 2025: a business guide

The government’s rules for drivers are evolving in 2025, with changes to tax, fuel duty, and regulation around electric vehicles (EVs). Don’t get caught out and learn the latest about driving laws. 

Whether it’s just you and your van or you’ve got a fleet of cars for your business – here are six new driving laws in 2025 you need to know: 

1. Fuel duty freeze continues
2. Road tax increasing for all vehicles
3. Benefit in Kind rates are increasing
4. Changes for heavy goods vehicles 
5. Self-driving cars on the way?
6. Congestion charges begin for EVs 

1. Fuel duty freeze continues

The current rate of fuel duty (52.95 pence per litre) will continue until March 2026. Since 2011, the government has capped fuel duty to stop fuel prices rising in line with inflation. 

In the Autumn Budget, Chancellor Rachel Reeves announced the freeze will continue while maintaining the existing 5p cut for another year, too.  

2. Road tax increasing for all vehicles 

From April 2025, Vehicle Excise Duty (more commonly known as road tax) rates will increase for every type of vehicle. The biggest price hike comes from the new first-year rates for newly registered cars, especially ones with higher emissions. 

The standard rate of road tax is only expected to increase by £10 to £165. And for vehicles registered after 1 April 2017, the effects will be minimal. 

But for older vehicles with higher emissions, the costs will go up more. The first-year tax for diesel and petrol cars emitting over 76g/km of CO2 will double compared to the current rate from April 2025. 

The rates you’ll pay are dependent on the tax band and emissions of your vehicle – the government’s guide to vehicle tax rates explains in more detail.

3. Benefit in Kind rates are increasing 

From April 2025, Benefit in Kind (BIK) rates are increasing by one per cent in each tax bracket, for every type of vehicle. The rates range from 21 per cent to 37 percent, with higher emission vehicles having higher BIK rates.

Electric vehicles currently have a low BIK rate of two per cent, but from April 2025, this will steadily increase by one per cent each year until 2028. 

So if you’re currently offering company cars as a part of a salary sacrifice scheme or a company benefit, your employees will pay more tax from the new financial year.   

From 2026, there’ll be changes to how you’ll need to report and pay tax with BIK. Income tax and Class 1A National Insurance contributions on most BIKs will need to be paid in real-time through PAYE.

4. Changes for heavy goods vehicles 

If your business uses heavy goods vehicles (HGVs), there are a few new regulations to be aware of: 

• it might become easier to get a Certificate of Professional Competence (CPC). The government wants to make training more accessible and fit for purpose
• Transport for London (TFL) will require all HGVs to have a safety permit before entering most parts of Greater London. HGVs must meet the requirements of the Progressive Safe System by 4 May 2025 to drive in these parts of the capital
• if your business uses HGVs for international travel, you’ll need to upgrade your tachographs to the latest version to comply with new regulations

5. Self-driving cars on the way?

With the Automated Vehicles Act 2024 being passed in May 2024, the groundwork has been laid for self-driving cars in the UK. The Act provides a clear legal framework, addresses liability concerns, and prioritises safety, setting the stage for wider adoption of automated vehicles in the years to come.

The potential impact for small businesses could be significant, with self-driving cars likely to impact the future of supply chains, deliveries, and logistics. 

6. Congestion charges begin for EVs 

From December 2025, any vehicle entering the Congestion Charge zone in London  will need to pay the £15 fee. EVs and hydrogen fuel cell vehicles will no longer be exempt from the charges.   

Many businesses have invested in electric vans or cars to avoid regularly paying the Congestion Charge and need to prepare for the extra costs. 

Which new driving law will affect your business most? Let us know in the comments.

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