These days general public strive to take maximum benefit out of an opportunity. And this is no less in the case of saving up few bucks given a chance. We all want to have a cost-effective way in an expensive investment like Car. Buying a car can lead to an expensive investment out of our budget. And this brings us to seek for the most tax efficient car in the market. Also, if you are a businessman who is running your own show and looking forward to buying a company car, it becomes indispensable to look for the most tax efficient option. It is important to take note of two things while gearing up for a tax-efficient Cars hunt. So, basically, when purchasing is happening through the company, the point to remember is – should the vehicle be provided through the business which makes an asset of the company and what are the cost implications of this? And if you are buying for the family or your own, you should remember – should you buy the car privately with own money and make it a personal investment. The premium you pay on the type of the vehicle is majorly dependant on CO2 emissions, list price, the type of fuel it uses and the accessories for the vehicle. Also, BIK rates can rise within the year 2019 – 20 tax year, which means that it will impact to buy your dream car due to tax rise. With this paradigm shift on the tax, it becomes more important than ever to look for the vehicle in the most tax efficient way.
Electric vehicles used to be exempted from the BIK rules, and this was a good tax saver option prior to 2016 – 17 tax year. Now, one has to report on the zero-emission vehicle. However, you can pay a related BIK tax at a reduced rate of 20% of £3320. Thus, going green is no longer a tax-free option, but it does help while choosing a petrol or diesel powered vehicle. Working out the exact amount one will pay in tax for a company car or a commercial car is a complicated task, with many variables to take into consideration. With a proper review of the specifics of car owner situation, it is possible to reduce and buy most tax efficient cars and reduce cost in an effective way. On the 1st of April, 2017, Britain’s road tax system was completely altered. In the new road tax system, the motorist should pay a fixed amount irrespective of how much CO2 is emitted. This was not the case earlier as the tax was predominantly based on the emissions of CO2 in a particular vehicle. This meant that any petrol or diesel car which is registered after April 1st, 2017 should pay an annual charge of £140 whereas hybrid and plug-in hybrid models are supposed to pay £130 a year and there is also premium charges applicable on the car which cost more than £40,000 to buy. So, this brings down to one important thing. That is, if you are a new car buyer who wants to avoid paying road tax entirely, you need to choose a zero-emission car. Currently, this shall include fully electric vehicles and hydrogen-powered vehicles. However, there are plenty of road tax-free options for choosing a cat registered before 1st April 2017. Indeed if you choose a car registered between March 2001 and 31st March 2017, with CO2 emissions less than 100g/km, you are excluded of paying road tax.
Here is the list of the best-used road tax-free cars in the market.
1. Renault Kadjar SUV
when the old tax system was applicable, nobody ever predicted that few SUVs would one day qualify for a tax exempt status. The Renault Kadjar SUV has 108 bhp, 1.5-litre diesel engine which emits 99g/km of CO2 which essentially makes it tax-free if registered before April 2017. Renault Kadjar is relatively high-end SUV with decent space and a large boot. Though it is mechanically similar to the Nissan Qashqai, we rate Kadjar slightly higher because it is more spacious and cheaper compared to its counterparts. In terms of price, you will have to spend a bit extra over the entry-level petrol model. Although there’s no seven-seat option, families are likely to find the Kadjar a practical car. There’s space for three to sit in the rear without clashing shoulders and a useful array of cubbyholes for items needed en route. And what won’t fit inside will certainly go in the boot – at 472 liters, it’s larger than that of the Qashqai and it’ll expand to 1,478 liters if you fold the seats down. There’s a broader choice of diesel engines, but our favorite all-rounder is the 108bhp 1.5-litre, which boasts 74.3mpg economy and an 11.9-second 0-62mph time. Its CO2 emissions are the lowest in the range, too, and a 24% Benefit-in-Kind (BiK) rating is good news for company car users. While entry-level Renault trims can sometimes be rather sparse, the whole Kadjar range is relatively well equipped, with DAB radio, LED daytime running lights, air-conditioning, Bluetooth and a stereo compatible with MP3 and USB storage. Our pick of the range is the Dynamique Nav, which upgrades the climate control to a dual-zone system and also introduces sat nav, Apple Car Play and Android Auto compatibility and 17-inch alloy wheels. The range-topping Signature S Nav is fairly luxurious with its heated leather seats and adds clever features such as blind-spot monitoring, autonomous parking and a reversing camera – but it’s a little pricey.
2. Vauxhall Astra Hatchback
If you are not looking for a big estate or SUV, the Vauxhall Astra is one of the more competent family hatchbacks around. Vauxhall has pulled out all the stops for the latest model, making it better to drive and more interesting to look at than ever. An impressive 200kg weight reduction means that the high economy and low CO2 emissions were significantly easier to achieve. Unlike some of the cars on this list, you can even have a road-tax-exempt pre-April 2017 petrol Astra, thanks to Vauxhall’s peppy turbocharged 1litre three-cylinder engine. This emits just 99g/km of CO2, returns 65.7mpg and gets the Astra from 0-62mph in a reasonable 10.5 seconds. If you’re after diesel power, Astra’s 1.6-litre 108bhp engine should fit the bill: this emits less than 100g/km of CO2, regardless of trim. Choose the ecoFLEX model and CO2 emissions are just 88g/km. If you want a touch more power, the 134bhp 1.6-liter diesel is also available as a sub-100g/km model. For performance lovers, the most powerful petrol engine is the 197bhp 1.6-litre turbo, available only in a few top variants. It’s capable of taking the Astra from 0-60mph in 7.3 seconds, but the price is a fall in fuel economy to 43.5mpg and a rise in CO2 emissions to 151g/km, making a BiK rating of 31%. This engine has been designed and tested to meet strict new emission laws that’ll be enforced from September 2019. Astra’s dashboard feels much more contemporary and logical than the previous model and the standard ‘IntelliLink’ infotainment system gives in-car technology a real capability, with far fewer fiddly buttons than in previous Astras. There’s plenty of interior space and boot capacity is only 10 liters less than the VW Golf. While Astra’s popularity on company-car lists might have tarnished its desirability to some extent, the latest version has been updated on leaps and bounds. It’s quiet on the move and feels comfortable without losing out too much in handling stakes.
3. Skoda Octavia Estate
Skoda Octavia Estate and its hatchback sibling feature in our list because they’re such competent, good-value cars. The Octavia Estate gets the recognition here because of the fact that its vast 6 to 10-liter boot doesn’t affect emissions or economy at all compared to the hatchback. The Octavia Estate also has an incredibly spacious interior and isn’t half bad to drive either. Those seeking to escape road tax should look at either the 104bhp 1.6-litre diesel engine or the 108bhp GreenLine model – also a diesel, as these emit 99 and 90g/km of CO2 respectively, making them completely tax-free if registered by the end of March 2017. The GreenLine is more expensive than the basic S model with a 1.6 litre diesel engine but Skoda gives an infotainment touch screen which is a rear spoiler, larger alloy wheels, and an extra 4bhp compared to the Octavia S. The petrol engines are well suited to those who cover less than 12,000 miles a year who primarily drive in urban areas. Although a 1.0-litre engine sounds rather small for a car like this it offers surprisingly strong and smooth performance, reaching 62mph from start, in 10 seconds and returning up to 62.8mpg, a figure that was meant for diesel cars until recently. Skoda has a stellar reputation amongst its owners and the Skoda Octavia finished 21st out of the 75 cars ranked in our 2017 Driver Power owner satisfaction survey of cars currently on sale in the UK.
4. Citroen Grand C4 space Tourer MPV
The Citroen Grand C4 Picasso has redefined expectations of how big and capable a sub100g/km car can be. With seven seats as standard, a pleasingly futuristic looking interiors with decent standard equipment, and those families in need of a spacious, light and stylish MPV are well served by this Grand C4 Picasso. The only pre-April 2017 tax-free engine is the 99bhp 1.6-litre BlueHDi 100 diesel and, while this feels a little slack, the Grand C4 Picasso’s soft suspension and family suitable nature hardly encourage spirited driving anyway. The Grand C4 SpaceTourer is available in three trim levels, called Touch Edition, Feel and Flair. The entry-level Touch Edition model has alloy wheels, cruise control, air-conditioning, front fog lights, Bluetooth connectivity, DAB radio, rear parking sensors and a seven-inch infotainment screen. Upgrading to Feel adds bigger wheels, aluminum roof rails, folding door mirrors, front parking sensors, sat nav and a 12-inch central infotainment display. Owner satisfaction with the Grand SpaceTourer is variable, though, as it finished in an ordinary 96th place out of 150 cars in our 2016 Driver Power owner satisfaction survey. Also, there are fewer question marks over safety. Although Euro NCAP has only crash tested the five-seat Citroen C4 SpaceTourer, it says it is satisfied with the Grand C4 SpaceTourer would achieve the same five-star result as its smaller sibling.
5. Volkswagen Golf GTE Hatchback
The Volkswagen Golf GTE has official CO2 emissions of just 40g/km, meaning it was easily under the threshold for road tax exemption before April 2017. Unlike some other hybrid cars, the GTE is capable of decent performance when you feel like it, although fuel economy suffers as a result. The car is able to run on pure electric power for 20 miles for the best economy, but it also has a ‘GTE’ mode, which allows you to exploit the full potential of the 148bhp 1.4-litre petrol engine and the electric motor together, for a more entertaining driving experience. Covering 0 to 62mph in 7.6 seconds is brisk by any standard – even if it can’t match the GTI’s 6.4 seconds and the fact that this performance is delivered by a small 1.4-litre turbocharged engine seems remarkable. Of course, the electric motor has a big part to play. It’s the same as that used in the Audi A3 e-Tron and brings total power to 201bhp. Whether the car is running on petrol, electricity or a combination of both, the GTE’s hybrid setup makes for quiet and effortless progress. The Volkswagen Golf finished 18th out of the 75 cars ranked in the 2017 Driver Power owner satisfaction survey of cars in the UK. If you look at it as a gently capable touring hatchback with low post-purchase costs, you should be very satisfied with this. The economical Golf GTD diesel still seems a more reasonable choice, all thanks to its much lower purchase price.
6. Mercedes E class Saloon
If you are looking for a luxurious end, the Mercedes E-class should be on your cards. You’ll have to go for a hybrid model registered before April 2017 to save few bucks on road tax. Although the least polluting E-Class diesel engines are impressively economical, they didn’t qualify for free road tax under the old rules. The CO2 emissions are of just 49g/km, the petrol-electric E350e hybrid easily qualifies for top performance and also avoids the London Congestion Charge. The 350e is far from the cheapest E-Class on the used market, but the running costs savings it offers makes up for this. Performance is impressive with 0 to 62mph takes just 6.2 seconds, however trying to achieve this will make the E350e’s claimed 134.5mpg fuel economy a farfetched dream, and the 2.0-litre petrol engine sounds strained when you’re exhilarating on. Still, for wafting about in executive style (tax-free) comfort and luxury, few cars match the E-Class’ sense of worthiness. Also, you can even charge it up at home and cover up to 20 miles on battery power alone. The E350e plug-in hybrid has been discontinued, but it’s set to be replaced by a new E300de model in 2019, featuring a 2.0-litre diesel engine, electric motor, and lithium-ion battery pack. Low emissions and excellent fuel efficiency are expected to make it a top choice for company car drivers.
7. BMW 3 Series saloon
The BMW 3 Series has a much more driver involvement and a little less luxury than the Mercedes E-Class, but costs are less compared to E-class. The petrol-electric BMW 330e is also fractionally faster than the hybrid Mercedes above 0 to 62mph takes just 6.1 seconds with the BMW while its 148.7mpg is similarly impressive. There is no road tax for cars registered on or before 31 March 2017 and no London Congestion Charge, making a used 330e a sound financial choice. The addition of a hybrid battery pack means the 330e’s boot is about 20% smaller than the standard saloon. The four-door saloon is the big seller, but if you need to carry bulky loads, there’s also an estate version called the BMW 3 Series Touring. If you like more luxury with your practicality, there’s the BMW 3 Series GT with its five-door hatchback body style and generous standard equipment. For performance lovers, there’s the BMW M3 Saloon. Features like air conditioning, Bluetooth, DAB digital radio and even sat nav are standard with the first trim level, which is called SE. With glamour flourishing inside and an amazing exterior makeover, the Sports trim is very appealing, while M Sports models look even more aesthetic and it gets upgrades like leather upholstery. The BMW 3 Series range finished 37th out of the 75 cars ranked in the 2017 Driver Power owner satisfaction survey of cars in the UK.
8. Skoda Citigo Hatchback
The Skoda Citigo is like an inexpensive, small city car that feels more grown up and spacious than its size and price would suggest. GreenTech package which enables the Citigo to escape road tax whether you choose the 59 or 74bhp version of the 1.0-litre petrol engine, as long as they were first registered under the old system of taxation. The more powerful engine is a wise choice if you are planning on venturing out of town with reasonable regularity, but these models are a little more expensive to buy. The five-door model also commands a premium but is worth if you’re regularly carrying more than one passenger. The SE comes with air-conditioning, electric front windows, and remote central locking – small extras, but these are the ones you’re likely to appreciate. The most recent Citigos have a far more sophisticated interior than earlier examples. The latest update introduced an eye-catching look and a broader range of color options, with two-tone finishes available. SE cars and above have a color ‘Swing’ touchscreen infotainment system, a more informative instrument panel and a multifunction steering wheel. The basic S model makes do with a fuel warning light in place of a fuel gauge. Although the Skoda Citigo didn’t appear in our 2018 Driver Power survey’s top 75 models, Skoda’s reputation for owner satisfaction has always been impressive. The company finished in sixth place overall out of 26 brands surveyed, with owners clearly impressed by the low running costs, reliability and practicality of their cars.
9. Hyundai i10 Hatchback
The Hyundai i10 is slightly more expensive than the Skoda Citigo but comes with five doors as standard. There’s very little to choose between these two city cars. The i10 is enjoyable to drive and cheap to run, while the 65bhp 1.0 liter Blue Drive model was road-tax-exempt, if sold before April 2017, and returns 65.7mpg. Most i10 engine and trim combinations will cost just £20-30 a year in tax under the old rules, but choosing the automatic gearbox will leave you paying £145 a year which is a relatively large bill for such a small car. The entry-level S model has electric front windows, 60:40 split-folding rear seats and USB connectivity, which isn’t bad for a basic city car. Moving up to the SE model brings air conditioning, cruise control, Bluetooth and DAB radio, and these are extras worth having if you can afford the extra cost. The higher-spec i10 models look like less of a bargain because they cost more, but the more luxurious extras are included. The Hyundai i10 finished 57th out of the 75 cars ranked in the 2017 Driver Power owner satisfaction survey of cars in the UK.
10. Peugeot 308 Hatchback
The Peugeot 308 range was launched with a 1.6-litre BlueHDi engine that ducked under the tax threshold by emitting 98g/km of CO2. This model remains free to tax if it was registered before April 2017 and makes the 308 a shrewd choice as an ownership proposition. This is not only a tax-exempt, but it’s also capable of 83mpg, meaning you will spend relatively little on fuel. Almost all 308s were fitted with plenty of standard equipment, so it’s very likely that if you’re looking at a nearly new or used version of the current generation, this will feature all the essentials for one to drive around in the city. New upholstery finishes, smarter touch screen graphics and updated services including TomTom Live traffic updates, plus Apple CarPlay and Android Auto for smartphone users help bring the 308 bang on up to date.
11. Ford Focus Hatchback
The Ford Focus has always been a colossal sales success across Europe and beyond. There are those who say that the now discontinued third generation is a little complacent, losing ground to its rapidly improving SEAT Leon and Kia Ceed rivals, along with stalwarts like the Vauxhall Astra and Volkswagen Golf. As with the previous model, there is no three-door version, but five-door hatchback and estate versions are available, while an off-road-style Active version aims to draw attention away from fashionable SUVs. When the Ford Focus first appeared in the late 1990s, it leaped straight to the top of the class for driver enjoyment and handling agility, however, subsequent generations lost a little of this sheen, although now Ford claims to have moved mountains to regain its lead for driving fun. A new independent rear suspension design, clever electronically monitored suspension system and stiffer, lightened chassis are said to be the key, and a range of modern petrol and diesel engines provides plenty of power too. A convincing five-star safety rating from Euro NCAP means the Focus is one of the safest cars in its class, with more safety technology than any Ford before it. Ford’s finished in 16th place in the 2018 Driver Power survey and the previous Focus finished 33rd out of 75 cars, but Ford will want the latest model to improve on this.
12. Hyundai i30 Hatchback
If you glance at a list of the best-selling models in the UK and the overwhelming majority are hatchbacks, with most of those a similar size to the Hyundai i30 and aimed squarely at families. Safety is one area where the i30 excels because Hyundai has fitted technology like autonomous emergency braking (AEB), lane-keeping assistance and even headlights that dip automatically – all as standard. This isn’t something that can be said for every rival and is a commendable move by Hyundai. The 1.0-litre petrol with 118bhp and a larger 1.4-litre boasts 138bhp for both diesel and petrol is ideal for a family. These are modern, eager, turbocharged engines and vie for attention next to the 108bhp 1.6-litre diesel. Inside the i30 is comfortable, aesthetically pleasing and feels well built with the dashboard design being conservative. All i30s come with a DAB radio, all-round electric windows, alloy wheels, LED running lights and Bluetooth connectivity, but it’s definitely worth upgrading from basic S trim to either SE or (ideally) SE Nav.
13. Honda Civic Hatchback
The Honda Civic is long established and this is the 10th generation, but it also has a habit of reinventing itself, and the latest Civic has unique looks to tempt buyers to look away from the mainstream. Power comes from a range of small, turbocharged engines, starting with a 1.0-litre, three-cylinder petrol that’s punchy and economical. A larger 1.5-litre sits above it in the range, but the 1.6-litre i-DTEC diesel really steals the show for fuel efficiency. It’s claimed to achieve over 80mpg and its low CO2 emissions mean it can be used as a company car. Costing roughly the same as a Golf, it’s certainly not a budget option, but it does tend to be better equipped. Even the SE model gets all-round parking sensors, lots of driving assistance devices, Bluetooth and DAB radio, climate control and 16-inch alloy wheels. For this reason, the entry-level 1.0-litre in SE trim is actually our pick of the range. Civic is loaded with advanced safety features including adaptive cruise control and autonomous emergency braking.
14. SEAT Leon Hatchback
During 2017 the Leon was given a facelift, bolstering its ability to compete. Its looks were given a mild refresh, and inside all but the entry-level S model now gets an eight-inch infotainment screen. SE Technology is our pick of the range, bringing DAB radio, sat nav, cruise control, and autonomous emergency braking, while FR Technology adds LED headlights, dual-zone climate control and connections for Apple CarPlay and Android Auto. The interior has an upmarket feel, even if it can’t quite match the Volkswagen Golf for overall quality. Compared with the Peugeot 308’s ‘i-Cockpit’, the Leon feels much more conventional, but it’s clearly laid out and feels more modern than models like the Ford Focus. Space is decent too, with enough room for most passengers in the front and back seats, along with a sizeable 380-liter boot. If you are a business driver or tend to go on long trips often, the 108bhp 1.6-litre TDI diesel can work out the cheapest to run, with a 70.6mpg fuel consumption figure. CO2 emissions of 105g/km mean it qualifies for 26% Benefit-in-Kind (BiK) company-car tax liability. It finished 47th out of the 75 cars ranked in the 2018 Driver Power owner satisfaction survey of cars in the UK.
15. Kia Ceed Hatchback
Kia is a amazing brand right now with it’s sporty looks. The engine range is well suited to the UK market, too, even if the entry-level 1.4-litre MPI petrol is best ignored, as it’s both slower and less efficient than the turbocharged options. Most drivers will find the 118bhp 1.0-litre T-GDi plenty powerful enough and it can return up to 52.3mpg. With CO2 emissions of 122g/km, company-car drivers are also likely to find this version appealing. Interior quality has taken another impressive leap upmarket, making it easy to talk about the Ceed and Golf in the same breath without any variation. Material quality is excellent and the ‘floating’ touchscreen looks modern, while also allowing designers to make the dashboard particularly shallow to boost passenger space. It beats in some key areas like practicality while also being impressively refined and better to drive than before.
