Driving Into London: What You’ll Pay

The costs are changing - here is what that means for you

From 2 January 2026, the London Congestion Charge will rise to £18 per day. It is the first increase since 2020 and, importantly, it sits below inflation over that period. For most drivers, that means budgeting slightly more for trips into central London. Pay on the day or in advance and the £18 covers unlimited entries within charging hours. Miss the deadline and you have three days to pay at a higher £21 rate - an avoidable premium if you plan ahead.

Electric vehicles lose their long-standing 100% discount on 25 December 2025. From January 2026, EVs registered on Auto Pay will receive a 25% discount at £13.50 per day. EVs not on Auto Pay pay the full £18. For commercial users, there is a sharper incentive to go electric: electric vans, HGVs and quadricycles on Auto Pay get 50% off, paying £9 per day. Motorcycles and mopeds remain exempt.

Why the change? Congestion costs London an estimated £3.85 billion a year, or roughly £942 per driver in wasted time and fuel. Without an adjustment, modelling suggests more than 2,000 additional vehicles could enter the zone each weekday. The higher daily charge, tiered discounts and EV rules are intended to keep traffic flowing while nudging cleaner, more efficient travel.

Charging hours remain consistent - weekdays 7am to 6pm and weekends 12pm to 6pm - so timing still matters. If you can re-time a delivery or appointment outside these windows, you avoid the charge entirely. Central London residents continue to receive a 90% discount at £1.80 per day. From March 2027, however, new resident applicants will only qualify if they drive an EV, while current holders keep their discount regardless of vehicle.

Understanding APR is not just about percentages - and understanding the Congestion Charge is not just about a headline price. It is about what you will actually pay, trip by trip, and the choices that reduce it.

A brief word for private hire drivers: if you operate five days a week in the zone, an EV on Auto Pay at £13.50 per day totals £67.50 a week, or around £3,510 a year. Without Auto Pay - or if not driving electric - you are looking at roughly £90 a week, or £4,680 annually. Small daily differences add up quickly over a busy year.

Short standout tip: Register for Auto Pay if you enter the zone regularly - it is the simplest way to avoid late fees and unlock EV discounts.

Who should pay attention now

If you drive into central London for work, appointments, events or school runs, these changes affect your wallet from early 2026. Frequent visitors - trades, couriers, delivery firms, rideshare drivers and company car users - will feel the increase most, particularly if trips fall within weekday daytime hours. Central London residents should also take note, as future eligibility links to EV ownership for new applicants from March 2027. And if you run a small business with city clients, it is time to revisit travel policies, explore Auto Pay, and consider whether electrifying vehicles can meaningfully reduce operating costs without disrupting service.

Ways to approach your London trips

1. Register for Auto Pay to avoid the £21 late rate and secure EV discounts.

2. Shift trips outside charging hours - weekdays before 7am or after 6pm, weekends before 12pm or after 6pm.

3. Switch to an EV and use Auto Pay - £13.50 per day versus £18.

4. For commercial fleets, electrify vans or HGVs - £9 per day via Auto Pay.

5. Use public transport for single-passenger journeys where practical.

6. Combine errands into one day - the fee covers unlimited daily entries.

7. For residents, maintain your 90% discount and plan EV ownership if applying from 2027.

8. For PCO drivers, model weekly costs and set earnings targets accordingly.

What it could mean for your pocket

Who qualifies and when

The Congestion Charge applies when entering, driving within or leaving the zone during charging hours - weekdays 7am to 6pm and weekends 12pm to 6pm. Cars, vans and most vehicles are liable. Motorcycles and mopeds are exempt. From 25 December 2025, EVs lose their full discount. From January 2026, EVs on Auto Pay receive a 25% discount at £13.50 per day, while EVs not on Auto Pay pay the full £18. Electric vans, HGVs and quadricycles on Auto Pay qualify for a 50% discount - £9 per day.

Residents living within the zone continue to receive a 90% discount, paying £1.80 per day when the charge applies. Importantly, from March 2027, new applicants for the resident discount must be EV drivers to qualify, though existing residents with the discount will keep it regardless of vehicle. The charge permits unlimited entries on the day once paid, so consolidating trips helps. Kandoo customers weighing vehicle upgrades can factor these rules into total cost of ownership, from finance terms to charging costs and potential savings on city operations.

Plan your route - step by step

1. Check if your journey enters the CCZ during charging hours.

2. Decide whether to reschedule outside charge times.

3. Register or confirm Auto Pay details before travelling.

4. If eligible, choose EV or electric van to cut fees.

5. Combine stops to use one daily payment efficiently.

6. Pay in advance or same day to avoid the £21 late rate.

7. Keep receipts for expenses and tax records.

Weighing it up

Before you set off

Think in weekly and annual terms, not just per day. Five weekday entries at the standard rate is £90, which compounds significantly over a year. If your pattern is regular, Auto Pay is nearly a default choice. For EV drivers, it is essential if you want the lower rate. Commercial operators should stress test delivery windows, load patterns and charging dwell times before switching vehicles. Residents should confirm their eligibility now and plan ahead for the EV link if applying from 2027. Finally, remember that the charge is only one piece of the puzzle - fuel, parking, clean air zones elsewhere and insurance all influence the true cost of driving into central London.

Small choices - Auto Pay, timing, route planning - make a large difference over time.

Next steps: set a reminder for payment, review your vehicle choice, and register for Auto Pay before January 2026.

If not driving, try these

1. Rail or Tube for single-passenger trips within the zone.

2. Park-and-ride or parking outside the CCZ, then public transport in.

3. Car share or split journeys to reduce entries.

4. Cycle or e-bike for short central trips, weather permitting.

Frequently asked questions

Q: What are the Congestion Charge hours in 2026? A: Weekdays 7am to 6pm and weekends 12pm to 6pm. Outside these times there is no charge.

Q: How much will I pay each day? A: £18 per day if you pay in advance or on the same day. If you pay within three days after travel, the cost is £21.

Q: Do motorcycles pay the charge? A: No. Motorcycles and mopeds are exempt from the Congestion Charge.

Q: What happens to EV discounts? A: The 100% discount ends on 25 December 2025. From January 2026, EVs on Auto Pay pay £13.50 per day. EVs not on Auto Pay pay £18.

Q: Are there discounts for commercial electric vehicles? A: Yes. Electric vans, HGVs and quadricycles on Auto Pay pay £9 per day from January 2026.

Q: Do residents still get a discount? A: Yes. Eligible residents inside the zone pay £1.80 per day. From March 2027, new applicants must use an EV to qualify, though existing holders keep their discount.

Q: Does one payment cover multiple entries? A: Yes. The daily fee covers unlimited entries into and within the zone on the same charged day.

How Kandoo can help

Kandoo is a UK-based retail finance broker that helps you compare finance options for cars and vans, including EVs. If you are considering switching to an electric vehicle to cut congestion costs, we can help you explore affordable, regulated finance choices that fit your budget and timelines. Speak to us before you change vehicle so your finance and running costs align.

Important information

This guide provides general information and is not financial or legal advice. Rules and prices can change, and individual eligibility varies. Always check the latest details with Transport for London before travelling or making purchase decisions.