Motability Changes from July 2026

Motability has announced a number of changes to its scheme, coming into effect from 1 July 2026. These updates will impact advance payments, mileage allowances and additional charges, marking one of the more significant shifts to the scheme in recent years.

For customers planning to renew their Motability agreement before this date, there is an opportunity to secure current terms and avoid these upcoming changes.

What’s Changing?

From 1 July 2026, several elements of the Motability scheme will be updated:

  • VAT added to Advance Payments and additional charges
    Advance Payments will now include VAT. For example, a £3,999 Advance Payment will increase to £4,799. Charges such as excess mileage will also be subject to VAT.
  • Reduced annual mileage allowance
    The yearly mileage allowance will decrease from 20,000 miles to 10,000 miles.
  • Higher excess mileage charges
    If you exceed your mileage allowance, the cost will increase from 5p per mile to 25p per mile.
  • Fewer replacement tyres included
    The number of tyres covered over a standard 3-year lease will reduce from 8 to 6.
  • EU cover fee introduced
    European cover, which is currently included at no extra cost, will now carry a £50 fee.

What Stays the Same?

Despite these changes, several key benefits of the Motability scheme remain unchanged:

  • Comprehensive insurance
  • Roadside recovery
  • Servicing and maintenance

These core elements continue to provide reassurance and support throughout your agreement.

What This Means for You

If your Motability agreement is due for renewal before 1 July 2026, acting early could make a significant difference. Securing a new agreement before the changes take effect means you can benefit from the current terms, including higher mileage allowances and lower costs.

For customers renewing after this date, it’s important to understand how these updates may affect your overall agreement and running costs.

Speak to Our Team

Our Motability specialists are here to help you understand what these changes mean and guide you through your options. Whether you’re approaching renewal or simply want clarity, we’re here to make the process straightforward.

Contact your local Williams retailer today or explore our Motability pages for full details on the upcoming changes.