The new Euro 6e-bis emissions standard will apply to all new PHEVs from January 1, 2025, and all existing models by December 31, 2025. This means current PHEV models must be retested to meet the new rules by the end of 2025.

Company car tax will be based on the emissions recorded at the car’s production date. Drivers with PHEVs they already own won’t be affected, but those ordering new cars this year might face higher tax rates if the car is retested before delivery.

For determining the official CO2 emission value of PHEVs, For PHEVs, CO₂ emissions are measured in two scenarios:

1. Driving with a fully charged battery until it runs out.
2. Driving with an empty battery.

The results are then combined using a utility factor (UF), which reflects how far the vehicle can drive using just the battery before switching to the engine.

Impact on Drivers and Fleets

These changes will result in higher tax bills for PHEV drivers. For example, a PHEV previously classified with a lower emission figure may now face a jump in annual tax costs due to its revised classification. Fleets relying on PHEVs as a tax-efficient option may need to reconsider their vehicle policies.

Incentives for Fully Electric Vehicles (EVs)

The updates continue to favour fully electric vehicles, with BIK rates for EVs remaining comparatively low, despite small annual increases planned for 2028/29 and 2029/30.

Industry Implications:

These changes highlight the government’s shift toward encouraging the adoption of fully electric vehicles while phasing out benefits for hybrid technologies that don’t achieve substantial real-world emissions reductions. Businesses and drivers should reassess fleet choices and tax implications as stricter emissions standards take effect.