👉 The Upfront Cost Of A Car
👉 Maintenance Costs
👉 Car Insurance
👉 Fuel Costs
👉 Road Tax
👉 The Hidden Cost - Depreciation
👉 Bringing All The Costs Together
The average new car in the UK costs anywhere from £19,000 to £33,000, with used cars costing less at £16,000 to £18,000. For many, the purchase price is seen as the ultimate price, but there are plenty of hidden fees behind the scenes that you should take into account before buying.
When you walk into a dealership, whether online or in person, you’ll see clear price tags on every car. But that sticker price isn’t the full cost of buying. There are a few extra charges you need to be aware of.
For starters, you might pay sales tax, which is added on top of the advertised price. Even if sales tax doesn’t apply, registration fees will. Getting your car legally on the road can cost hundreds of pounds, and documentation fees often push the total even higher.
Then there are optional extras that sales teams may offer you, such as extended warranties, add-ons like paint protection, or GAP insurance (which covers you if your car is written off and worth less than your finance). These can give peace of mind but also add significantly to the upfront bill.
By the time you drive away, the amount you pay could be much higher than the price you first saw on the car.
The average car will cost around £473 to repair in 2025, a 32% increase from 2020. Costs in this bracket include MOTs, servicing, oil repairs and general bumps and scratches.
An MOT is required every year and costs up to £54.85.
A full service is recommended every year, or whenever your car hits 12,000 miles. A full service will set you back around £90 - £180.
The average cost of UK car insurance in 2025 is £757, a steep figure that buyers must take into account when it comes to car ownership.
This figure depends on the type of car you own, your age and driving history, and so the figure can come down. We’ve covered all things car insurance in dedicated guides that you can find here. As part of our car insurance suite, you will find
Petrol and diesel can cost up to £747 a year (GOV.UK), but this may rise if you use your car for frequent, long journeys. If you own an electric car and want to make the most of super-fast charging, your costs will fall anywhere from £500 to £1,300! (Which.co.uk)
When it comes to choosing a car, consider cars with the best fuel economy, helping you make the most of your money.
For most cars, tax will set you back £195 (RAC). However, if your car had a list price of £40,000+ at the time of initial purchase, you may have to pay an extra £425 luxury car tax. Over recent years, many have looked to electric cars as a way to reduce car tax, but this is set to change in 2025.
Depreciation is a cost often overlooked by car buyers, but it can hurt your finances indirectly, and must be taken into account when it comes to buying a car.
Depreciation is when a car loses value over time. The average depreciation amount in the UK is £1,251 and will affect newer cars the most. As soon as a car leaves a dealership, it’s losing money, but this tends to slow down the older the car is. For this reason, many buyers choose a used car that has already gone through the main depreciation stage.
|
Fuel |
£747 to £1,300 (depending on fuel type) |
|
Maintenance |
£473 |
|
Insurance |
£737 |
|
Road Tax |
£195 |
|
Depreciation |
£1251 |
|
Total Cost |
£3403 to £3956 |
There you have it: Owning a car in the UK will cost anywhere from £3,400 to £4,000, a massive amount that must be factored into the purchase price.
For many people, this amount of money is hard to put aside, but building savings slowly can help.
Explore our savings guides for more help:
Save on the initial purchase price with finance. Car finance can be a great way to avoid an upfront car fee and instead spread it into affordable monthly payments. When you add car ownership costs into the mix, car finance is a no-brainer.
Explore our car finance options completely obligation-free and apply without impacting your credit score.