What are the best tax-free cars, post tax shake-up?

April 2017 marked the introduction of a new road tax system. Previously, any car that emitted 100g/km of CO2 or less qualified for free road tax (or ‘vehicle excise duty’ (VED) as it is officially known).

However, sometime around 2014/15, the UK government twigged-on that new cars were becoming ever more efficient and an increasing number of models were limboing the 100g/km CO2 mark, leading to lost revenue for the Treasury.

So to keep the coffers topped up, the powers-that-be moved the goalposts. This meant that any petrol or diesel car registered from April 1st 2017 pays £140 a year, regardless of how much CO2 it emits.

For hybrids and other alternative fuel vehicles (fuelled by LPG and bioethanol), that drops to £130 a year, and as it stands, the only vehicles exempt from paying road tax are those that don’t emit any CO2 at all – i.e hydrogen-fuelled or electric vehicles (EVs).

However, there’s another twist in the tale. If a zero CO2 vehicle has a list price of more than £40,000, it is subject to an additional rate of £310 a year for the next five years after a free first 12 months, which affects high-end EVs like the gullwing-doored Model X, but interestingly, not the fleet-friendly Tesla Model 3.

This additional rate is plonked on top of whatever drivers of petrol or diesel cars already pay too.

So, if you’re averse to lining the government’s pockets, which cars should you consider?

Hyundai Ioniq Electric

We hailed Hyundai’s first production hybrid as a potential ‘Prius killer’ last year, and while it is offered as a conventional and plug-in petrol-electric hybrid, you’d need to opt for the fully electric Ioniq to avoid paying road tax.

Luckily, it’s a very capable EV despite Hyundai’s limited experience in pumping out battery-powered cars.

The electric Ioniq can drive for up to 174 miles on a single charge, which is more than enough juice to get you from London to Manchester without stopping to recharge. It’s also much more than the 155 miles offered by the current best Leaf.

BMW i3

BMW’s first ever production EV is also offered as a ‘Range Extender’ petrol-electric hybrid, but like the Ioniq, only the electric model qualifies for free VED.

Despite its mini MPV-esque silhouette, it is one of the most distinctive-looking choices in the electric car market, but with a 125-mile range, it is far from the most far-reaching.

Nissan Leaf

This is the car that really kicked off the electric car revolution, launching as the world’s first all-electric production vehicle in 2011.

The Leaf is another eye-catching EV and one that still looks like no other car out there, six years on. Fitted with the larger 30kWh lithium-ion battery, it can drive for up to 155 miles without recharging, while the 24kWh version provides up to 124 miles.

Nissan e-NV200

What happens when you take a Nissan Leaf and drop a van on its head? The e-NV200, that’s what.

This panel van/seven-seater family wagon uses the same powertrain as the 2014 Leaf, but with a much larger and less aerodynamic body shape, it can only cover a maximum of 106 miles before needing a plug socket.

Still, it serves as a great tool for eco-conscious businesses covering short distances.

Toyota Mirai

All the cars we’ve spoken about so far are pure electric, so where are all these hydrogen cars? As infrastructure is still very much in its infancy, with few hydrogen filling stations available to the public, hydrogen cars are still essentially being trialled on business car fleets.

However, Toyota is leading the way with the Mirai, which is available now. The four-seater saloon has a 342-mile range, more than double that of most electric cars. But with a £66,000 asking price currently, it will need to come down in price to dodge road tax.

Other road-tax exempt cars worth considering include:

Renault Zoe

Volkswagen e-Golf

Volkswagen e-Up

Smart ForTwo Electric

Kia Soul EV

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