From April 1, the way cars are taxed is changing, but few people are aware of the new laws.

The research by Confused.com reveals, with just 31 days to go only one in 10 UK drivers understand the new car tax laws.

Here is a handy guide to what you need to know.

What are the new changes?

  • The new laws only apply to new 2017-plate cars registered from April 1.
  • The ‘first licence rate’ for vehicle tax remains the same in the first year, and continues to be based on the vehicle’s CO2 emissions.
  • After the first year the vehicle will pay one of three standardised rates based on the vehicles fuel type:

£140 per year for petrol and diesel vehicles

£130 per year for ‘alternative fuel’ vehicles, such as hybrids

£0 per year for zero emissions vehicles, such as fully electric

  • Vehicles where the manufacturers list price is over £40,000 will have to pay an additional £310 on top of the standard rate for five years. After this it will be taxed at the standard rate.

Currently, car tax is calculated on a vehicle’s CO2 emissions. Cars below 120g/km pay as little as £0 - £30 annually, while comparatively more pollutant vehicles with emissions over £255g/km pay £515 per year.

However, under the new rules, revised emissions-based tax brackets have been created, which will mean that anyone buying a new car from April 1st may have to pay a much higher emissions-based ‘licence rate’ in their first year.

For example, owners of new cars with emissions of 120g/km will pay a first year rate of £160, while owners of cars with emissions over 255g/km will pay a whopping £2,000 in the first year.

But it doesn’t end there. Anyone buying a new car from April will have to pay a standardised rate of car tax after their first year, which for petrol or diesel cars is £140, regardless of the vehicle’s emission levels.

It seems the standardised rate of tax will hit owners of lower emissions vehicles the hardest. For example, those buying new vehicles with emissions of 120g/km will find themselves paying £160 in their first year and £140 every year after.

So with the average driver owning their car for up to five years, this will equate to a whopping £720 over five years, compared to just £150 they would have paid if they bought their car before April 1st 2017.

How much more would car owners be paying?

For a 120b/km car, the current tax is £30, but this will rise to £160 for the first year, and £140 for the following years.

For a 150g/km car, the current cost is £145, but this will rise to £200 for the first year, and then £140.

For a 170g/km car, the cost will rise from £210 to £500 for the first year and then £140.

Anyone with a car over 255g/km will see tax rise from £515 to £2,000 for the first year, and then £140.

What impact is this having?

Perhaps unsurprisingly, the new rules are putting drivers off buying new.

In fact, two fifths (40%) of drivers say that the new rules would discourage them from purchasing a car with a 2017 plate.

And, while the only way out of paying car tax is to buy a car with zero emissions, under a quarter (23%) of drivers would consider buying an electric vehicle. In fact, two fifths (43%) remain unconvinced that electric cars are the way forward.

But the changes could mean we see a surge of used cars on our roads, with over half of drivers (57%) saying they would be more inclined to buy a second-hand motor to avoid the charges.