HGV Levy in UK: Rates, Payment, & Impact on Businesses

Introduction

The UK imposes the Heavy Goods Vehicle (HGV) Levy on vehicles weighing 12,000 kg or more. The government uses this charge to ensure both UK-registered and foreign-registered HGVs contribute to maintaining and repairing the country’s road infrastructure. The levy applies to vehicles based on their weight, emissions standards, and the duration of their use on UK roads. In this blog, we’ll explore the current HGV levy rates, recent changes, how the levy works, and the consequences of failing to pay. If you operate an HGV, staying informed about the levy is essential for avoiding penalties and ensuring compliance.

What is the HGV Levy?

The HGV Levy is a charge that applies to heavy goods vehicles weighing 12,000 kg or more. The UK introduced this levy in 2014 to make operators contribute to the wear and tear their vehicles cause on UK roads. The levy amount depends on factors such as vehicle weight, axle configuration, and EURO emissions class. Operators of cleaner vehicles with higher emissions standards, such as EURO VI, pay lower rates to encourage environmental responsibility. The levy applies to both UK-registered and foreign-registered vehicles that use UK roads.

How the HGV Levy Works

Its structure reflects the vehicle’s weight and environmental impact. Here’s how it works:

Vehicle Weight: Heavier vehicles cause more damage to the road infrastructure, so they incur higher levy rates.
Emissions Standards: Vehicles meeting stricter emissions standards (such as EURO VI) qualify for lower levy rates, promoting cleaner, more sustainable vehicles.
Payment Options: Operators can choose to pay the levy annually or for shorter durations, depending on how frequently they use the vehicle on UK roads.

The levy applies to both UK and non-UK vehicles, ensuring that international hauliers also contribute to the upkeep of UK roads. UK government’s website has a detailed guidance.

HGV Levy Rates and Payment

As of 2024, HGV levy rates depend on vehicle weight and emission standards:

For vehicles weighing between 12 and 31 tonnes:
- EURO VI (cleaner) vehicles: £150 annually.
- Older vehicles (EURO V or earlier): £195 annually.
For vehicles weighing over 38 tonnes: The levy can reach up to £749 annually.

UK-registered vehicles often include the levy payment as part of the Vehicle Excise Duty (VED). Foreign-registered vehicles must pay the levy before entering the UK. Operators can pay the levy online using various methods, including debit/credit cards, fuel cards, and PayPal.

Who Needs to Pay the HGV Levy?

It applies to any vehicle with a gross laden weight of 12,000 kg or more, including UK-registered and foreign-registered vehicles using UK roads. Businesses and haulers must ensure their vehicles are registered and the levy is paid before entering the UK. Foreign vehicles must pay the levy before crossing into the UK.

Exemptions exist for certain types of vehicles, including:

Vehicles used for driver instruction
Showman’s vehicles
Zero-emission vehicles

Exemptions to the HGV Levy

HGV Levy exemption — Battery Charged HGV

While most HGVs must pay the levy, some vehicles are exempt, including:

Zero-Emission Vehicles: HGVs with zero tailpipe emissions are exempt.
Vehicles Used for Driver Instruction: These vehicles are exempt from the levy.
Island Goods Vehicles: Vehicles that only operate on small islands and do not use mainland UK roads are exempt.
Repair or Maintenance: HGVs with trade plates traveling to or from a garage for repair or maintenance do not need to pay the levy.

HGV Levy Suspension and Recent Changes

In response to the COVID-19 pandemic, the UK government temporarily suspended the levy to support businesses in the transport sector. The suspension began in August 2020 and ended on July 31, 2023. During this period, hauliers didn’t have to pay the levy.

The government reinstated the levy in 2023 with revised rates. Moving forward, the government expects to link the levy more closely with vehicles’ environmental performance, imposing higher rates on older, more polluting vehicles.

Why is the HGV Levy Important?

The HGV Levy serves multiple purposes in the UK’s transport ecosystem:

Fair Contribution to Road Maintenance: HGVs cause significant wear and tear on roads, especially motorways and major trunk routes. The levy ensures operators contribute to maintaining these vital parts of the transport network.
Environmental Considerations: The levy is also linked to the UK’s environmental strategy. The exemption for Euro VI vehicles is part of a broader push to reduce emissions and encourage the use of cleaner, more efficient vehicles.
Revenue for Road Investment: The funds generated by the levy are reinvested in maintaining and improving the road network, which is essential for supporting UK trade and logistics.
Leveling the Playing Field: The levy applies to both UK and foreign operators, ensuring that international hauliers contribute equally to the cost of maintaining UK roads, preventing an unfair competitive advantage.

Impact on Businesses and Haulers

It has a significant impact on haulers and logistics companies. Here’s how:

Increased Operating Costs: The levy adds to the overall cost of running an HGV fleet, especially for operators with older, heavier vehicles.
Fleet Management: To reduce levy costs, businesses may invest in cleaner, more fuel-efficient vehicles that qualify for lower rates.
Cross-Border Operations: Foreign hauliers must be aware of the levy to avoid delays and fines when entering the UK.

Overall, the levy encourages businesses to adopt cleaner, more environmentally friendly vehicles, aligning with the UK’s broader sustainability goals.

FAQs

How do I pay the HGV levy?

You can pay it online via debit or credit card, fuel card, or PayPal. Non-UK vehicles must pay before entering the UK.

What happens if I don’t pay the HGV levy?

If you fail to pay the HGV levy, you could face severe penalties. Enforcement agencies use automatic number-plate recognition (ANPR) cameras, ferry records, and other checks to monitor compliance. Failure to pay results in a £300 fine, which is payable immediately at the roadside. If you cannot pay the fine, the authorities may impound your vehicle, disrupting your delivery schedule and incurring additional costs.

Are there any exemptions to the HGV levy?

Yes, zero-emission vehicles, vehicles used for driver instruction, showman’s vehicles, and island goods vehicles are exempt from the levy.

How do I check my HGV levy status?

To check whether your HGV levy is up to date, operators can use the DVLA’s online service. The service allows you to verify the status of your vehicle’s levy, make payments, and manage your account. Simply enter your vehicle’s registration number to access the information.

When was the HGV levy suspended?

The UK government suspended the HGV levy from August 2020 until July 31, 2023, in response to the COVID-19 pandemic.

Has HGV levy rate increased?

The Department for Transport (DfT) has suggested raising the rates for the HGV Road User Levy and road tax in 2024. The proposed increases vary between 2% and 4%, depending on the vehicle’s weight category.

Conclusion

The HGV levy plays a crucial role in supporting the UK’s road infrastructure and promoting environmental responsibility within the transport sector. With recent changes to the levy and further adjustments expected in the coming years, hauliers must stay informed about the levy’s rates, exemptions, and payment processes. Timely payment and compliance are vital to avoid fines and contribute to the sustainable management of the UK’s roads.

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