Good news for 40-year-old classic car owners
On April 1, 2025, cars registered throughout 1984 became tax exempt, and also old enough to avoid the London Ultra Low Emission Zone (ULEZ) fee of £12.50 per day.
Car ownership in the UK can feel like a losing battle against costs and regulations sometimes. However, this 40-year exemption rule provides welcome relief for classic car enthusiasts, acknowledging that these vehicles—which make up a statistically insignificant proportion of cars on UK roads—contribute very little to the pollution and CO2 emissions that modern taxation and low-emission zones aim to reduce.
How the 40-Year Rule Works
Actually, to call it a 40-year rule isn’t quite accurate. From April, vehicles registered prior to January 1, 1985 became eligible for free tax and ULEZ, meaning 1984 models. If you have a 1985 car and are eagerly awaiting tax exemption, the date to look forward to is April 1, 2026.
The main condition for tax exemption beyond a vehicle’s age is that no ‘substantial changes’ have been made to the vehicle within the last 30 years, such as replacing the chassis, body, axles, or engine – not something that will affect a matching-numbers collector car, but potentially more of an issue for evocations, replicas or restomods.
Exemption doesn’t automatically apply either. For vehicle tax, you must apply at a Post Office with your V5C log book and either evidence of an MOT or a V112 MOT exemption certificate, which the Post Office will then send to the DVLA, and a new log book will be sent through the post.
Doing so automatically entails your vehicle to ULEZ exemption too, so there are no additional steps here once your car is registered as a ‘historic vehicle’. Likewise, MOT exemption comes part and parcel – once the vehicle passes 40 years old, it is automatically exempt.
The Class of 1984 - Now exempt
Several vehicles that made their debuts in 1984 have become tax, MOT, and ULEZ exempt this year, but a trio of 1984 launches in particular stand out. These include two of Ferrari’s most recognisable models: the 288 GTO and the Testarossa.
Ferrari 288 GTO
The GTO was a response to 1982’s new Group B racing and rallying regulations, requiring only 200 vehicles to be produced to meet requirements – allowing for considerably more technical freedom than previous Group 3 and Group 4 regulations, which as of 1981 required 1,000 and 500 units respectively in a 12-month period. Ferrari eventually built 272 examples of the 288 GTO, whose 2.9-litre twin-turbocharged V8 produced nearly 400bhp. The most recent sale price of a 288 GTO was nearly £3 million at today’s exchange rate, with RM Sotheby’s in May 2024.
Ferrari Testarossa
The Testarossa meanwhile was Ferrari’s flagship mid-engined sports car. Only first-year models will be exempt from VED and ULEZ in 2025 – for the very last 512M variants, owners will have to wait until 2037 – but the Testarossa’s characteristic 4.9-litre flat-12 was very nearly as powerful as that of the 288 GTO, albeit in a heavier, more touring-orientated package. The car’s Pininfarina styling defines the automotive aesthetic of the 1980s more than any other car. Testarossas typically achieve in the region of £150,000 at auction, though the very best have sold for more than £300,000.
Ford RS200
(Image credit: Ford)
Last of 1984’s notable new arrivals is the Ford RS200. As with the 288 GTO it was developed for Group B, specifically rallying, taking over from Ford Motorsport’s short-lived Escort RS1700T project. While one of Group B’s most definitive shapes, its part in the danger and downfall of Group B means its most notable motorsport successes came on the rallycross stage, rather than the WRC. Road-going variants regularly achieve £200,000-£300,000 at auction.
Classic Cars Already Tax-Exempt
(Lamborghini Miura SV. Image credit: Lamborghini)
Here are some other iconic classics which have already been enjoying tax and ULEZ exemption:
- Jaguar E-Type – All years of the E-Type have been tax-exempt for some time. Series 1 are worth anything between £80,000 and £100,000 in top condition
- Porsche 911 – 1984 exemption means the earliest Carrera 3.2s are now enjoying tax-free status, but the coveted Carrera 2.7 RS, with values topping £1 million, already avoids VED and ULEZ.
- Mercedes-Benz 300SL – There can be few more stylish ways to drive through London ULEZ-free than the ‘gullwing’ SL; excellent examples regularly top £1.5 million at auction.
- BMW 3.0 CSL ‘Batmobile’ – Recent ‘Batmobile’ sales have exceeded £300,000, but built in the 1970s, all are tax, MOT, and ULEZ exempt.
- Dino 246 GT – The sneering at Maranello’s beautiful V6 sports car stopped long ago; sales figures in the high £200k to low £300k range are now commonplace.
- Lancia Stratos – Sharing its engine with the Dino above, the Stratos is one of the most recognisable (and valuable, at £300k-£500k) rally specials. It’s usefully-sized (and now ULEZ-free) in the city, too.
- Chevrolet Corvette Stingray – Possibly one of America’s most beautiful cars, the C2 Corvette Stingray (values up to £200k for split-window cars) has been tax-exempt for a while; in fact, early C4 Corvettes lose their VED this year.
- Lamborghini Miura – The Miura, and indeed the first decade of its Countach replacement are VED-free. Miuras can approach £2 million, and SV and SVJs more than £3 million.
- Bentley S1/S2/Continental – Bentley’s 1950s and 1960s saloons and coupes are among its most iconic models. All look fabulous, and are ULEZ-free, in London.
- Rolls-Royce Silver Cloud II/III – Like their Bentley equivalents above, the Silver Cloud is also tax and ULEZ-free. Both Bentley and Rolls-Royce start at £60,000 and end well north of £100,000.
- Aston Martin DB4/DB5/DB6 – The most famous models in the DB series are all comfortably VED and ULEZ-free. The best DB4s come in at £400k, DB5s at £600k-£700k, and the DB6 typically £160k-£200k.
