The Best Tax Exempt Cars in the UK

One way to save on motoring costs while reducing your carbon footprint is by opting for a vehicle that qualifies for zero road tax. To help in your search, we journey into the best tax exempt cars in the UK by taking a look into the top 10 models available here at Wilsons Epsom. 

We'll explore a diverse range of vehicles, from compact city cars to family-sized SUVs, each offering unique features and capabilities. You'll get an in-depth look at models like the iconic Fiat 500e, the innovative Hyundai IONIQ 5, and the high-performance Tesla Model 3.

For complete clarity, we'll provide a balanced view of each vehicle, highlighting both its strengths and potential drawbacks to help you make a fully informed decision. By the end of this article, we hope you'll have a much clearer understanding of the top cars exempt from road tax and the benefits they offer. 

So, let's plug in and start our journey through the electrifying world of zero road tax cars! 

Key Takeaways

• Zero road tax applies to all fully electric vehicles (EVs) in the UK, resulting in significant annual savings.
• Our top 10 zero road tax cars offer a range of options, from city cars like the Fiat 500e to luxurious saloons like the Tesla Model 3.
• Electric vehicles not only save on road tax but often have lower running and maintenance costs compared to petrol or diesel alternatives.
• The range of EVs has significantly improved, with many models offering well over 200 miles on a single charge, addressing many concerns about ‘range anxiety’.
• Charging infrastructure is rapidly expanding, with many EVs capable of fast charging from 10-80% in under an hour.
• Beyond road tax savings, EVs often qualify for additional benefits such as congestion charge exemptions and lower company car tax rates.
• While the initial purchase price of EVs can be higher, government grants and long-term savings on costs such as road tax can often offset this.
• Even with zero road tax to pay, EV owners must still renew their tax exemption annually through the DVLA website.
• While EVs are currently exempt from road tax, it's important to stay informed about potential future policy changes.

Understanding Road Tax in the UK

Before we dive into our top tax-exempt picks, let's quickly recap what road tax actually is. In the UK, Vehicle Excise Duty (VED), commonly known as road tax, is based on a car's CO2 emissions. Vehicles emitting 0g/km of CO2 are currently exempt from paying road tax, making them an attractive option for cost-conscious and environmentally aware drivers.

Top 10 Cars with Zero Road Tax

1. Fiat 500e
2. Hyundai IONIQ 5
3. Hyundai KONA Electric
4. MG4 EV
5. MG5 EV Long Range
6. MG ZS EV
7. Nissan LEAF
8. Peugeot e-208
9. Renault Megane E-TECH 100% Electric
10. Tesla Model 3

Fiat 500e

Pros:

• Zero emissions mean exemption from ULEZ and Congestion Charge in London
• Low running costs: works out to approximately 5p per mile
• Three driving modes to choose from including ‘Normal’, ‘Range’, and ‘Sherpa’ for maximum efficiency

Cons:

• Limited rear space might not suit families
• As such, the boot capacity only reaches 185 litres in the EV version  
• Premium price point compared to the non-electric Fiat 500 which is cheaper to purchase

Road Tax Benefit:

Because the Fiat 500e is exempt from road tax, you could save up to £180 annually compared to petrol model variants. Over a five-year period, this would amount to £900 in tax savings alone.

Why Buy?

The iconic Fiat 500 has embraced the electric revolution, offering a perfect blend of retro charm and modern efficiency, while being exempt from road tax. This nimble city car boasts an impressive range of up to 199 miles on a single charge, making it perfect for city-based folk and short-distance commuters. 

If time is of the essence, then the electric 500’s fast charging capabilities will have you grinning from ear to ear, when you can add up to 30 miles of range in just five minutes - quick enough to grab a cup of tea while you wait. For an 80% charge, you can expect to wait 35 minutes - just long enough to do the weekly food shop. 

Are you looking to keep costs down during ownership? Then you’ll enjoy the regenerative braking system so whenever you lift your foot off the accelerator, kinetic energy is collected and converted to electricity in order to help recharge the battery. 

Hyundai IONIQ 5

Pros:

• Spacious interior with flat floor design
• Eco-friendly materials used throughout the cabin
• Qualifies for the Plug-in Car Grant, offering additional savings

Cons:

• Higher initial cost compared to some competitors
• The larger size may be challenging in some urban environments
• We think the styling may be Marmite - you’ll either love it or you’ll hate it! 

Road Tax Benefit:

Avoid the £490 first-year rate and £180 standard rate applicable to equivalent petrol SUVs with the all-electric Hyundai IONIQ 5. Over five years, this equates to a saving of £1,210 - enough money to secure two tickets to the Oasis reunion!

Why Buy?

The Hyundai IONIQ 5 is widely considered a game-changer of a car in the electric crossover market, offering futuristic design and cutting-edge technology. With a range of up to 354 miles, it's suitable for both city driving and longer journeys too. 

One of its standout features is the ultra-fast charging capability - it can charge from 10-80% in just 18 minutes with a 350kW charger. The IONIQ 5 also introduces Vehicle-to-Load (V2L) technology, allowing you to power external devices, turning your car into a mobile power source - very handy when on the go. 

As with most modern EVs, you can expect to benefit from regenerative braking power which will help alleviate too much time (and money!) being spent at charging stations. 

Hyundai KONA Electric

Pros:

• Impressive range suitable for long journeys
• Eligible for various government incentives
• Low running costs, estimated at around 4p per mile to charge

Cons:

• Less rear seat and cargo space than some similar-sized rivals
• DC fast-charging connection could be quicker
• Prices are at the premium end of the compact SUV segment

Road Tax Benefit:

Because the Hyundai KONA Electric is currently exempt from road tax rates, you can save up to £180 annually compared to petrol KONA models. Over a five year period, this amounts to savings of £900, which could be better spent on a whole new wardrobe of clothes!

Why Buy?

The Hyundai KONA Electric combines the practicality of an SUV with the efficiency of an electric powertrain. It impresses with its range of up to 319 miles on a single charge, making it suitable for long journeys without the dreaded ‘range anxiety’. 

If you think you’ll have to spend hours waiting at a charging point, then think again, as you can add 100 miles of range to the KONA Electric in just 15 minutes thanks to 100kW rapid charging, ensuring you spend more time driving and less time waiting. 

The fully electric model also features a unique heat pump system for efficient cabin heating, which helps preserve battery life in colder conditions - meaning that the overall lifespan of your battery is also protected. 

MG4 EV

Pros:

• Excellent value for money in the EV market
• Qualifies for the Plug-in Car Grant
• Over-the-air (OTA) updates for continuous software improvements without lifting a finger

Cons:

• Brand perception is not as strong as some competitors
• Interior quality could be improved throughout the cabin
• Some drivers comment that the touchscreen infotainment system can be fiddly to use 

Road Tax Benefit:

With the MG4 EV you can avoid the £190 first-year road tax rate and £180 standard rate applicable to equivalent petrol hatchbacks. During long-term ownership, this can save £910 over five years.

Why Buy?

The all-new MG4 EV is a testament to how far electric vehicles have come in terms of affordability and performance. It offers a more than acceptable range of up to 323 miles, rivalling much more expensive EVs in terms of driving distance. 

Need more mileage? Then opt for the extended range Trophy trim which will be right up your street. Charging is swift, with the ability to go from 10-80% in as little as 35 minutes when using rapid charging - ideal for that cheeky road trip with mates.  

The MG4 EV also boasts a 50:50 weight distribution, which contributes to improved handling and driving dynamics not often associated with affordable EVs. This thoughtful design feature also means you’re more likely to maximise the available mileage and spend less on charging. 

MG5 EV Long Range

Pros:

• Multi-award-winning all-electric estate car
• Practical for families and those needing extra space thanks to 1,367 litres of boot capacity
• Low running costs, estimated at around 4p per mile

Cons:

• Conservative and basic styling may not appeal to all
• Ride comfort inside the cabin could be improved
• Limited rear headroom for taller passengers due to the estate’s sloping roof design

Road Tax Benefit:

Save up to £880 of road tax in the first year and £180 annually thereafter compared to some petrol estates when you invest in the fully electric MG5. Over five years, this could amount to £1,600 in tax savings - a healthy amount for that holiday fund!

Why Buy?

MG seems to be ticking all the right boxes when it comes to producing quality cars free from road tax charges. As the world's first all-electric estate car, the MG5 EV Long Range breaks new ground in the electric vehicle market. 

We think it perfectly combines the practicality of an estate car with the benefits of an electric powertrain. Distance-wise, the MG5 offers a range of up to 250 miles, suitable for most daily commuter needs and even longer trips. 

Growing in popularity, MG describes its MG5 model as a “practical, affordable and efficient electric estate car” which we think sums it up pretty well. Certainly, the manufacturer’s MG Pilot suite of advanced driver assistance features is a comforting addition to the entire driving experience. 

MG ZS EV

Pros:

• Affordable entry into the electric SUV market for first-time buyers
• Spacious interior with 470 litres of boot space for family duties
• ULEZ compliant which makes it ideal for city driving

Cons:

• Some customers comment that the pedals are too close together 
• Interior materials are not as high quality as rival brands
• The handling could be better

Road Tax Benefit:

With the MG ZS EV model you can avoid the £390 first-year rate road tax and £180 standard rate applicable to equivalent petrol SUVs. Over a five year period, this equates to £1,110 meaning more money in the bank for you to enjoy! 

Why Buy?

The MG ZS EV is a car that proves affordable electric SUVs don't have to compromise on features or performance. When it comes to range, you can expect a fairly competitive 273 miles of driving distance on a single charge, making it more than suitable for a variety of journeys and purposes. 

As with all MG’s, charging is straightforward and as such, it can be charged from 0-80% in 40 minutes using 100kW rapid charging - ideal for those who don’t like waiting for things to happen! 

A notable selling point of the ZS EV is the MG Pilot driver assistance system which comes as standard, offering advanced safety features often found in more expensive vehicles - but for a fraction of the price. Now that’s speaking our language! 

Nissan LEAF

Pros:

• A well-established model with proven reliability as an electric car
• Eligible for various government incentives
• As with many EVs, expect low running costs of around 4p per mile

Cons:

• Battery range falls short of many competitor models
• The unique styling may not appeal to everyone’s tastes
• Some of our taller customers comment that leg space in the back is limited

Road Tax Benefit:

Compared to equivalent-sized petrol hatchbacks, you can save up to £180 in road tax costs every year with the Nissan LEAF. Over five years, that’s a saving of £900, which means you can book that boutique spa break you’ve been dreaming of!

Why Buy?

As a pioneer in the production of electric vehicles, the Nissan LEAF continues to offer reliability and practicality to drivers all over the UK. 

Pitched by the brand as an “electric family car”, the LEAF can travel a range of up to 168 miles, which, while not a huge amount of distance compared to other models, is still suitable for most daily driving needs. 

If you like to sit back and relax during the journey, then the LEAF’s e-Pedal technology will appeal to you; it allows for one-pedal driving, making city driving more convenient and potentially more efficient too - win win!

Peugeot e-208

Pros:

• Stylish-looking exterior and interior design
• Same decent-size boot space as the petrol variant (311 litres)
• Quick off the accelerator making it nearly as quick as a hot hatch

Cons:

• Premium-level pricing within its segment
• Divisive i-Cockpit layout may not suit all drivers
• Tight passenger space in the rear

Road Tax Benefit:

The all-electric Peugeot 208 means you can avoid the £190 first-year road tax rate and £180 standard rate applicable to petrol 208 models. Think what you can do with an extra £910 in your back pocket over five years!

Why Buy?

The fantastically fun Peugeot e-208 proves that going electric doesn't mean sacrificing style or driving pleasure. With a range of up to 248 miles on a single charge this little hatchback is perfectly suited to urban living 

If you’re always on the go, then you’ll like the e-208’s rapid charging capabilities of a speedy 0-80% charge in just 30 minutes - an ideal window of opportunity for a quick coffee with friends. 

When it comes to perks, then Peugeot has it in the bag; on those cold winter mornings, you can precondition the car via a dedicated app to warm it up before you start driving - we think that’s a brrr-illiant idea! 

Renault Megane E-TECH 100% Electric

Pros:

• Sleek new modern design
• Advanced driver assistance systems included as standard
• Low centre of gravity for improved handling behind the wheel

Cons:

• More expensive than some rivals
• Rear visibility could be better
• Boot space is average for its class

Road Tax Benefit:

Make road tax savings of up to £180 every year with the 100% electric Renault Megane E-Tech. Over the course of five years, that’s enough money to install that garden hot tub you’ve always wanted.

Why Buy?

Dubbed an “electric car for petrol heads”, the Renault Megane E-TECH brings a touch of French flair to the UK electric car market by combining style with substance. It impresses with a range of up to 285 miles per full battery charge which is more than suitable for most driving scenarios. 

If you’re anything like us, you won’t like waiting around, so no doubt you’ll love the ability to boost the Megane E-TECH’s battery by 186 miles in just 30 minutes - that’s enough time to sit back and enjoy an episode of Friends (with ad breaks too!).   

The on-board tech is pretty savvy and features the advanced OpenR Link infotainment system powered by Google, offering a seamless and intuitive user experience. Let’s not forget Renault’s groundbreaking ‘human first’ programme boasting up to 24 onboard safety features as standard. 

Tesla Model 3

Pros:

• Access to Tesla's extensive country-wide Supercharger network
• Regular over-the-air updates continuously improve functionality
• Best-in-class driving range

Cons:

• Higher initial price point than many on this list
• The minimalist interior may not appeal to all
• The suspension can feel stiff at times 

Road Tax Benefit:

For an equivalent premium petrol saloon car, you’d be looking at a first-year road tax rate of £970, followed by annual payments of £180. But with the Tesla Model 3, you could save a substantial £1,690 over a five-year period.

Why Buy?

The Tesla Model 3 continues to set the standard in the electric vehicle market, offering premium features and performance. The Long Range model boasts an impressive range of up to 390 miles, among the best in class. 

Charging is a breeze with Tesla's extensive Supercharger network, allowing you to add up to 175 miles in just 15 minutes. The Model 3 also features advanced Autopilot capabilities, pushing the boundaries of what's possible in driver assistance technology - what’s not to like?! 

Why Choose a Zero Road Tax Car?

Four reasons why we think zero road tax cars rule:

1. Cost savings - Besides saving on road tax, electric vehicles generally have lower running and maintenance costs.
2. Environmental impact - Zero-emission vehicles help reduce your carbon footprint.
3. Future-proofing - As emissions regulations tighten, zero-emission vehicles are well-positioned for the future.
4. Driving experience - Many electric cars offer instant torque, providing a smooth and responsive driving experience.

Frequently Asked Questions about Zero Road Tax Cars

Which cars have zero road tax?

All fully electric vehicles (EVs) currently qualify for zero road tax in the UK. This includes all the cars mentioned in our top 10 list above, as well as other popular EVs like the Volkswagen ID.3, Kia EV6, and Audi e-tron. Some hydrogen fuel cell vehicles, like the Toyota Mirai, also qualify for zero road tax.

What second-hand cars are tax-free?

Second-hand fully electric vehicles registered after April 2017 are tax-free. For cars registered between March 2001 and April 2017, vehicles emitting less than 100g/km of CO2 were exempt from road tax. However, it's important to note that for cars registered after April 2017, only zero-emission vehicles (primarily EVs) qualify for zero road tax.

How do you qualify for free road tax?

To qualify for free road tax, your vehicle must be classified as a zero-emission vehicle. Currently, this primarily applies to fully electric vehicles and some hydrogen fuel cell vehicles. It's important to note that hybrid vehicles, even plug-in hybrids, do not qualify for zero road tax.

What age does road tax stop?

Road tax doesn't stop at any particular age of the vehicle. However, vehicles manufactured before 1 January 1981 are exempt from paying vehicle tax. This is based on the vehicle's date of manufacture, not its registration date.

Can police seize a car for having no road tax?

Yes, the police have the authority to seize a vehicle that is being used on public roads without valid road tax. The DVLA can also clamp or tow away untaxed vehicles. It's crucial to ensure your vehicle is properly taxed or declared SORN (Statutory Off Road Notification) if not in use on public roads.

Can I drive a car I've just bought without tax?

No, it is illegal to drive a car on public roads without valid road tax, even if you've just purchased it. You must tax the vehicle before driving it. You can easily do this online on the DVLA website, and it takes effect immediately.

How much is a DVLA fine for no road tax?

The penalty for not taxing a vehicle can be severe. The initial fine is £80, which is reduced to £40 if paid within 28 days. However, if you don't pay the fine and the case goes to court, you could face a maximum penalty of £1,000. 

Can road cameras detect no tax?

Yes, Automatic Number Plate Recognition (ANPR) cameras used by both the police and the DVLA can detect untaxed vehicles. These cameras are widespread across the UK road network and can quickly identify vehicles that are not taxed, insured, or MOT'd.

Do I need to renew road tax on an electric car?

While electric cars are currently exempt from paying road tax, you still need to go through the process of 'renewing' your vehicle tax each year. This is essentially registering that your vehicle is still exempt. You can do this online through the DVLA website.

Are there any other financial benefits to owning a zero road tax car?

Yes, besides road tax exemption, zero-emission vehicles often benefit from:

• Lower Benefit-in-Kind (BIK) rates for company cars.
• Exemption from congestion charges in many cities.
• Cheaper running costs due to lower electricity prices compared to petrol or diesel.
• Potential grants or incentives for purchasing an electric vehicle.
• Often lower maintenance costs due to fewer moving parts.

Will zero-emission vehicles always be exempt from road tax?

While zero-emission vehicles are currently exempt from road tax, it's important to note that government policies can change. As more people switch to electric vehicles, the government is set to review this policy to maintain road infrastructure funding. It's always wise to check the latest regulations when considering a vehicle purchase. 

Find Your Next Tax Exempt Car

At Wilsons Epsom, we're committed to helping you find the perfect vehicle that aligns with both your lifestyle and values. Our range of zero road tax cars offers something for everyone, whether you're looking for a compact city car or a luxurious saloon.

Our knowledgeable staff are ready to answer any questions you may have about electric vehicles and can arrange test drives to help you experience the future of driving. Your wallet – and the planet – will thank you!