From 2 January 2026, the daily charge for driving through central London jumps from £15 to £18, the first increase in six years. For van hire businesses, delivery companies, and anyone relying on commercial vehicles to operate in the capital, this 20% hike means recalculating costs, rethinking routes, and finding smarter ways to manage the expense.
The changes don’t stop at the price increase. Electric vans lose their full exemption but gain a partial discount, residents face new restrictions, and future annual increases will automatically track tube fare rises. If your business involves regular trips into central London, understanding these London congestion charge changes in 2026 is essential for protecting your bottom line.
At CVS Van Hire, we’ve been offering reliable, high-quality vans for hire since 1961. With over three generations of experience and a 100% ULEZ-compliant fleet, we understand exactly what these changes mean for van drivers. If you want to stay ahead of the 2026 congestion charge changes, call us on 020 8015 4154 or email info@cvsvanhire.co.uk, and we’ll help you choose the most cost-efficient van for your needs.
CVS Van Hire provides reliable, cost-effective van hire solutions with low security deposits, 24-hour returns, and a daily 150-mile allowance. Our highly maintained vehicles help you navigate London's charging zones with confidence.
Why The Congestion Charge Is Increasing In 2026
Transport for London estimates that without changes, around 2,200 additional vehicles could enter the Congestion Charge Zone on a typical weekday. This surge would seriously undermine the scheme’s purpose of managing traffic and reducing pollution.
The charge has remained at £15 since 2020, despite significant inflation over those six years. More importantly, the explosion in electric vehicle adoption has created an unexpected problem.
When the 100% Cleaner Vehicle Discount launched in 2019, electric vans and cars were rare. Now they’re everywhere. The discount was initially scheduled to end on 25 December 2025, and rather than extend it unchanged, TfL (Transport for London) decided on a tiered approach. The logic is straightforward: electric vehicles still take up road space, contribute to congestion, and prevent buses and emergency services from moving efficiently through the zone.
For van users, movers, tradespeople, and businesses, these changes are very relevant. Higher charges, even with discounts, will influence which vehicles to hire, how often to enter the zone, and how to plan central-London routes more economically.
What’s Changing In The 2026 Congestion Charge Update
Drivers will start seeing the new structure from 2 January 2026. The changes affect how much you pay, who qualifies for discounts, and how future increases will be calculated. TfL positioned the update as a long-term adjustment rather than a one-off rise, which is why the new rules include automatic annual reviews.
Below is a clear, detailed look at the updates that matter most to drivers and businesses.
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Updated Daily Charge
The standard daily charge rises from £15 to £18 for all vehicles entering the zone during operating hours. If you pay within three days after travelling, the cost increases from £17.50 to £21. Operating hours remain the same:
- Monday to Friday: 7 am to 6 pm
- Saturday and Sunday: 12 pm to 6 pm
- No charge from Christmas Day through New Year’s Day
This might feel like a small rise, but it has a multiplier effect on fleets, delivery schedules, and contractors working within the zone. A company van that enters the zone three times a week will spend roughly £468 more each year.
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Electric Vehicle Discount Adjustments
Electric vehicles no longer receive a full exemption. Instead, a tiered system now applies:
- Electric vans, HGVs, and quadricycles registered with Auto Pay receive a 50 per cent discount
- Electric cars registered with Auto Pay receive a 25 per cent discount
This reduces the charge to £9 for vans and £13.50 for cars. The key requirement is Auto Pay registration. Without it, the vehicle pays the full £18 rate.
This discount structure will be reduced again in 2030. From 4 March 2030:
- Electric van discounts fall from 50 per cent to 25 per cent
- Electric car discounts fall from 25 per cent to 12.5 per cent
These future reductions reflect TfL’s expectation that electric vehicles will become the norm and should therefore contribute more fairly to traffic management costs.
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Changes the Residents’ Discount
Existing residents who already have a Congestion Charge Residents’ Discount continue receiving 90 per cent off. They pay £1.80 per day regardless of the type of vehicle they own.
New residents who apply after 2 January 2026 receive the 90 per cent discount only if they own an electric vehicle. Petrol and diesel vehicles no longer qualify for a reduced rate.
Low-income and disabled residents remain fully exempt until 2030.
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Blue Badge Holders and Other Long-standing Exemptions
The primary exemptions stay unchanged. Drivers with a Blue Badge, vehicles with nine or more seats, accredited breakdown vehicles, motorcycles, mopeds, and motor tricycles continue to pay nothing.
The main shift is the removal of the old 100 per cent Cleaner Vehicle Discount, which ends in December 2025. Electric vehicles will no longer be allowed to enter the zone free of charge.
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Automatic Annual Price Adjustments
From 2026 onwards, the congestion charge will increase annually in line with Tube fare changes. TfL introduced this policy to avoid significant single-year jumps and to maintain a consistent balance between public transport fares and driving costs.
Businesses operating within the zone will need to include these yearly increases in their cost planning.
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PenaltiesFor Non-Payment
Penalty Charge Notices remain at:
- £160 for non-payment
- Reduced to £80 if paid within 14 days
- Increased to £240 after 28 days
Automatic number plate recognition cameras continue to enforce the rules throughout the zone. The penalty amounts have not changed for 2026.
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No Changes to The Zone Boundary
The zone boundary remains the same. It continues to cover central London within the Inner Ring Road, including roads such as Pentonville Road, Euston Road, Marylebone Road, Edgware Road, Park Lane, Vauxhall Bridge Road, and Tower Bridge Road.
Anyone already familiar with the zone will not see any geographical expansion in 2026.
Smart Strategies For Van Hire Users
The London congestion charge changes in 2026 don’t have to destroy your budget. Here’s how to adapt:
- Time your journeys strategically: If possible, schedule deliveries or collections outside charging hours. Arriving at 6:15 pm instead of 5:45 pm saves £18. Early morning work before 7 am is exempt from congestion charges. Weekend work between 12 pm and 6 pm attracts the charge, but early Saturday mornings remain free.
- Batch your trips: The charge applies once per day, regardless of how many times you enter the zone. If you need to make multiple central London stops, consolidate them into a single day rather than spreading them across the week. One £18 charge beats three daily charges totalling £ 18.
- Register for Auto Pay immediately: It’s a must if you’re considering an electric van. The 50% discount makes a significant difference, but only for vehicles that are correctly enrolled in the system. Setup takes minutes and ensures every trip qualifies for the reduced rate.
- Consider your vehicle choice carefully: If you’re hiring long-term and making regular London trips, an electric van costing £9 per entry makes more financial sense than a diesel van costing £18. At CVS Van Hire, our entire fleet is ULEZ-compliant, and we can advise on which vehicles offer the best value for your specific usage pattern.
Conclusion
The 2026 congestion charge update marks one of the biggest shifts in London’s traffic management in recent years. For many van drivers, trades, and small businesses, the changes will take some adjustment, especially for those who rely on regular access to the city centre.
At CVS Van Hire, we’ve supported London businesses and individuals for over 60 years, through three generations of the Frost family. Our two branches in Tottenham and Enfield provide flexible, reliable van hire with low security deposits, optional insurance excess coverage, and 24-hour returns for maximum convenience. Every vehicle in our fleet is 100% ULEZ-compliant and well-maintained, so unexpected emission charges never catch you out.
If you need the latest guidance, help choosing the most cost-effective van, or support navigating the new rules, our team is always here to assist. Call us on 020 8015 4154 or email info@cvsvanhire.co.uk, and we’ll help you book a compliant, cost-saving van for your journey.
