Small cars with low road tax

Explore smaller cars with cheap road tax

Shopping for small cars with low road tax leads you to plenty of options – but which ones are worth buying?

If you want to save money on running costs by keeping road tax low, there are a host of small cars that can help you stick to a budget.

You could even grab an electric car for free road tax until 2025, or get a discount by picking a hybrid.

To help you choose, here’s a look at our favourite small cars with low road tax.

Best small cars with low road tax

Renault Clio (2019 onwards)

• Annual road tax: £190

• Annual road tax (hybrid): £180

The Renault Clio is a gem among small cars with low road tax that deserves more hype. Not only is it cheap to run, but it’s great value and has a premium feel.

With a hybrid option now on offer, fuel efficiency is better than ever . The 1.6-litre hybrid gets up to 67.3mpg and you have that £10 road tax discount.

The refined little Clio was awarded a full five-star Euro NCAP safety rating in 2019, with an impressive 96% rating for adult occupants and 89% for children.

Dacia Sandero (2017 onwards)

• Annual road tax: £190

The Dacia Sandero should be your top pick if you want a small car at a seriously good price point. You simply can’t beat its value for money.

Road tax is low and car insurance should be, too – with models sitting in insurance groups three to 14.

There are a couple of engine options, and the most efficient is the manual petrol that gets up to 53.3mpg.

Fiat 500e (2020 onwards)

• Annual road tax: £0 (until 2025)

An electric vehicle is the best way to get a small car with low road tax – it’s so low that it’s free until 2025.

The Fiat 500e is quite possibly one of the best options. You get all that’s cute and lovable about the OG 500, just with battery power.

With a handy range of up to 203 miles on a single charge, it’s ideal for your daily commute or casual tootles around the city.

It’s a stunning car, as well. We particularly love the unique colourways – the Rose Gold and Ocean Green are gorgeous.

Hyundai i10 (2020 onwards)

• Annual road tax: £190

For a reliable small automatic car with low road tax, what about a Hyundai i10? The 1.0-litre automatic is ideal for city driving and is efficient to run.

In fact, you can expect up to 52.3mpg and 122g/km of emissions.

Insurance costs shouldn’t hold you back, either. The i10 sits in groups four to 10, with the mid-range SE trim being one of the cheapest to cover.

Peugeot e-208 (2019 onwards)

• Annual road tax: £0 (until 2025)

Another slick electric option with free road tax, the Peugeot e-208 is worth looking at if you don’t want something that screams ‘electric power’.

This undercover electric car is modern without looking over-the-top futuristic, but still does its job of achieving up to 248 miles on a single full charge.

There’s plenty of interior tech as well, including a seven-inch touchscreen unit with Apple CarPlay and Android Auto as standard.

Toyota Yaris hybrid (2020 onwards)

• Annual road tax: £180

Want to dip your toe into electric power but aren't ready to fully commit? The Toyota Yaris Hybrid is a small car with low road tax that could be right up your street.

Supplementing the petrol engines with a hybrid power system allows you to achieve up to 68.9mpg from the 1.5-litre engines.

Even more impressively, the Yaris Hybris is self-charging with no need to be plugged in to boost. It saves you fuel and won’t add to your electricity bill.

Benefits of choosing small cars with low road tax

Since April 2017, you pay road tax based on emissions when you buy a brand-new car for the first year. After that, it goes to the standard rate for that model.

The typical standard rate for petrol and diesel cars is £190 per year, with £10 discount for hybrid models.

Cars that cost over £40,000 when brand-new come with an extra luxury car fee of £410 per year – unless they’re electric, when it’s still free until 2025.

Choosing a small car with low road tax helps contribute to cheaper running costs, which is even more important as fuel costs seem to keep rising.

Low road tax usually means lower harmful emissions from your car, so you can also consider it as reducing your impact on the environment.

Other ways to save

Choosing a small car with low road tax is a good first step to reducing your car running costs, but there are a few other things to consider.

A small car that’s popular and widely available will usually mean that parts are easy to come by and maintenance won't be tricky.

This will make it cheaper and easier for you if something goes wrong with your car.

You might also want to look at car insurance groups. The closer to group one, the cheaper to insure.

Keep in mind that factors like driving history and annual mileage will still affect your premiums. It's all relative though, so a car in group one will still be cheaper to insure than one in group 50.

Efficiency – in terms of fuel economy and electric range – can also keep running costs low.

Look for electric cars that have a mile range to suit your driving habits or choose petrol or diesel cars that have a healthy miles per gallon figure.

Find the perfect used small car at cinch

There are so many impressive small cars with low road tax on the market – way too many to include here.

Take a look at our full range of used small cars to find your perfect fit.

Read more about road tax:

• How much is road tax in the UK?

• The best cars with low road tax 2024