Van versus car: The running costs

If you want to trade in your car for a van but you’re worried about how much it’ll cost to run, we can help you weigh up your choices.

Amanda Bathory-Griffiths
Amanda Bathory-Griffiths
Updated 12 April 2023  | 2 min read

How much is van insurance?

There’s some difference in cost between car and van insurance.

In January 2023, the average annual price paid for fully comprehensive van insurance for social use only through GoCompare was £367 and the average price paid for fully comprehensive car insurance was £338.[1]

Van insurance is usually more expensive for commercial use. If you’re carrying goods for hire and reward, for example if you're a courier driver, the average cost is £1,137.

But if you just need cover for a daily commute and carriage of own goods, the average cost is £382, which is only a few pounds more than a social use only policy.

Key points

  • You need commercial van insurance to use your van for business, which is likely to be more expensive than business car insurance
  • Tax for vans is based on when the van was registered and its engine size
  • The cost of MOTs for cars and vans are the same

Your insurer calculates your premium based on your personal circumstances, your occupation and the risks associated with it, the crime rate where you live, where the van is parked overnight, plus a host of other factors.

Parking and insurance

If your van doesn’t fit in the garage you’ll have to park it on the street, or in a car park.

That can make your insurance more expensive because your van's at greater risk of being hit by another driver or stolen.

To reduce the cost of your premiums and keep your van safe:

  • Make sure you have good security systems in place, like an immobiliser or alarm
  • Get an allocated parking space in a residents car park

How much is van tax?

Vans are usually more expensive to tax than cars, unless your car is a heavy polluter or it cost more than £40,000 new.

The road tax rate – or vehicle excise duty (VED) – is calculated based on when the van was first registered, rather than on a sliding scale of emissions.

The 2023/2024 van road tax rates for light commercial vehicles with a gross weight of less than 3,500kg are:

  • Euro5 vans registered between 1 January 2009 and 31 December 2010: £140
  • Euro4 vans registered between 1 March 2003 and 31 December 2006: £140
  • All other vans registered after 1 March 2001: £320
  • Vans under 1,549cc registered before 2001: £200
  • Vans over 1,549cc registered before 2001: £325
  • Electric vans: £0

The prices above are for 12 months, but there is the option to pay bi-annually or split the cost into direct debit payments.

Car tax for cars registered after 1 April 2017 is based on emissions in the first year, then a set rate in subsequent years:

CO2 emissions Cost for diesel or petrol car in first year Cost for diesel or petrol car in its second year onwards
1-50 £10 £180
51-75 £30 £180
76-90 £130 £180
91-100 £165 £180
101-110 £185 £180
111-130 £210 £180
131-150 £255 £180
151-170 £645 £180
171-190 £1,040 £180
191-225 £1,565 £180
225-255 £2,220 £180
Over 255 £2,605 £180

Electric cars have no emissions and have no road tax to pay.

For cars registered before this, tax is based on emissions and fuel type every year.

Benefit-in-kind (BIK) rate for vans

Benefit-in-kind (BIK) is a tax you’ll have to pay if you use a company van for private use.

For 2023/2024, it’s a flat rate of £3,600 multiplied by your income tax banding (either 20% or 40%). If multiple people share the van, first divide the £3,500 figure by the number of employees using it.

If you only use the van for business purposes, you won’t have to pay it.

You also won’t have to pay it if you instead pay your employer to use the van privately.

Fuel benefit tax

The flat van fuel benefit charge if you’re driving a company van is £688 in 2023/2024.

MOT and servicing

It doesn’t cost more to MOT a van than it does a car.

Type of car MOT cost Type of van MOT cost
Up to eight seats £54.85 Goods vehicle (up to 3,000kg) £54.85
Dual purpose vehicle £54.85 Private hire vehicle £54.85
Goods vehicle over 3,000kg £58.60

A van that spends most of its time being driven gently on the motorway at constant speeds will be less likely to have high maintenance costs than one that spends its days in inner-city and urban environments.

Keep maintenance costs as low as possible with these key tips:

  • Listen for strange noises – reacting to problems early on will save you repair costs in the long run
  • Regularly replace bulbs and windscreen wipers
  • Check the water, oil and windscreen-wiper tank levels
  • Don't keep running the van on a near-empty tank
  • Check the tyre pressure regularly, especially before long trips

Hidden and other costs


There are 21 toll roads in the UK.

Each has its own pricing tariff for vans and cars, but toll roads usually cost van drivers more. For example:

Time of day Road Toll for a van Toll for a car
Weekday, 7am-7pm M6 £14.30 £8.20
Weekends and weekdays Clifton Suspension Bridge £1 £1
Weekends and weekdays Humber Bridge £1.50/£4, depending on weight £1.50
Weekends and weekdays Tyne Tunnels £2.20/£3.90, depending on weight £2.20

Fuel tank

Vans tends to have larger and more powerful engines than most cars, with a greater capacity for fuel. They will cost more to refuel because you need more fuel to fill the tank.

You can check how much your fuel will cost with our fuel calculator.

New van technology has assisted fuel consumption for all vans (the inclusion of a sixth gear, for example) but there's a staggering difference between a small, car-derived van, such as a Ford Fiesta van, and a large or medium-sized van, such as a Ford Transit.

There’s an independent site which lists and compares vehicle fuel consumption – see the Commercial Fleet page on van running costs.

Best fuel efficiency for miles per gallon

Van manufacturers must publish official miles per gallon (MPG) information about their models. It’s the figure that tells you most about a van’s fuel economy and affordability.

The MPG assessment conducted by manufacturers tests low, medium and high speeds for urban and non-urban driving. It’s a good guide, but if you have a heavy van, or drive quickly on motorways, that’ll affect the MPG in the real world.

Purchase price

New cars and vans are going to be very expensive, so shop around for the best cash, hire purchase or PCP deal you can find before signing up. Research GAP insurance if you’re taking out finance.

If you’re shopping second hand, you can pick up a bargain, but it depends on your budget, the size of van you want and if you’re prepared to do some research.

Always check the price of your insurance before buying a second-hand van. Although an older van will be cheaper to buy, if it’s difficult to repair or source the parts your insurance premium will be more expensive.

Money-saving tips for van drivers

  • Your sat nav or maps app might not automatically show the most fuel-saving route. Check the programming before you set off and see if you’re following a longer route on faster roads
  • Make a note of car parks before you travel and save fuel by not driving around looking for one
  • Insurer approved advanced driver courses can reduce the cost of your van insurance
  • Driving slowly and carefully reduces fuel bills, as well as maintenance costs and tyre replacements
  • An immobiliser alarm and secure locks can help reduce insurance premiums and keep you safe
  • A higher voluntary excess (if affordable), off-street parking (if possible) and no modifications (if practical) can help keep costs down when it comes to insuring your van

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[1]Average median price paid for comprehensive van insurance policies purchased through Go.Compare in January 2023.