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Motability Launches Special Investigations Unit as July 2026 Tax Changes Lift Costs

Motability says new VAT and insurance taxes will raise average upfront payments by about £400.

Overview

  • Motability has created a Special Investigations Unit and says around 80 investigators will target misuse and reclaim vehicles used in breach of scheme rules.
  • Planned measures include stronger data‑sharing with government and police to speed action when breaches are identified.
  • The Government confirmed VAT will apply to Advance Payments and Insurance Premium Tax to leases from July 2026, with existing leases and wheelchair‑adapted vehicles unaffected.
  • Motability expects the average Advance Payment to rise by roughly £400 over a three‑year lease and says 40–50 vehicles will still be available with no upfront payment.
  • Luxury brands such as BMW and Audi will no longer be offered to new customers, with Motability to consult users in spring 2026 before package changes take effect in July.