Published 22 June 2026
Disabled motorists and their families are being urged to plan ahead as significant tax changes to the Motability Scheme take effect from 1 July 2026. From that date, VAT and Insurance Premium Tax will apply to most new leases, a change the Motability Foundation says will raise the average Advance Payment by around £400 over a typical three-year lease.
The Advance Payment is the upfront contribution some customers pay towards higher specification vehicles, on top of exchanging part or all of their qualifying mobility allowance. While the average increase is around £400, the figure varies by vehicle, with some models rising by more and others by less. Importantly, the scheme has confirmed that no-advance-payment options will remain available, so customers on a tight budget will still have choices.
The changes apply only to new applications placed on or after 1 July 2026. Anyone who already holds a lease will see no change to their current agreement, and the scheme continues to include insurance, breakdown cover, servicing, routine repairs, tyres and batteries within a single all-inclusive package. The update applies across the UK with the exception of Scotland, where arrangements differ.
For people who use powered mobility equipment rather than a car, the scheme also leases powered wheelchairs and mobility scooters under the same all-inclusive approach. If you are weighing up whether to lease or buy outright, it can help to compare the long-term costs against purchasing your own equipment. Our guides to mobility scooters and wheelchairs set out the main options, and our wheelchair costs guide explains typical prices for buyers funding privately.
Advisers suggest that anyone considering an application should review their options before the deadline, as applying before 1 July may avoid the new charges on that lease term. It is also worth exploring whether other support, grants or retailer finance could reduce the overall cost of getting mobile. Comparing several suppliers remains one of the simplest ways to keep costs down, and you can use our directory to find a mobility company near you.
Full details of the changes are published by the Motability Foundation and on the Motability Scheme website, which both recommend that customers check how their specific vehicle is affected before committing.
Related guides on Review Mobility
- Mobility scooters: a complete buyer’s guide
- Wheelchairs explained
- How much does a wheelchair cost?
- Find a mobility company near you
Published 22 June 2026