Best cars with £20 road tax

Tired of paying through the nose for road tax? Check out the most appealing models that cost just £20 per year to tax

By James Wilson

With rocketing fuel costs and electricity prices soaring, no one wants to pay more car tax than is absolutely necessary. Thankfully, there are loads of affordable models available with £20 road tax - that’s less than 5.5p per day.

It doesn’t matter whether you’re after a tiny petrol city car, a medium SUV or a large diesel estate car, there’s no need to pay more than £20 in car tax. However, to find one of these low-tax models, you’ll have to pick a car that falls into a specific CO2 emissions band and was registered between two set dates.

The magic figures to bear in mind are 1 March 2001 and 31 March 2017 for the car’s registration date and official CO2 emissions of 101g/km to 110g/km for a petrol or diesel car and 111g/km to 120g/km for an alternative fuel car - such as a hybrid. If you’re wondering where on earth to find this information, fear not; the DVLA has a Vehicle Enquiry service that lists cars’ registration month and CO2 emissions. All you need to do is enter the car’s registration number.

Remember that while one car registered in March 2017 may cost £20 to tax, an identical model registered in April 2017 onwards would be £165 (or £155 for alternative fuel models). Meanwhile, pre-April 2017 cars with CO2 emissions of 100g/km or less are free to tax, while those of the same age with emissions of 111g/km to 120g/km are a reasonable £30, so you may still want to consider these.

Since cars’ CO2 emissions can vary depending upon their precise specification - with heavy optional equipment, such as large alloy wheels and panoramic sunroofs potentially increasing vehicles’ emissions - it’s wise to double-check the tax rate for any specific car you’re considering getting, before signing on the dotted line.

Keep reading for our selection of the best cars with £20 road tax. They are a mixture of sizes and shapes so there should be something for everyone - whether you're after a relatively large family car or a sporty convertible. To help you find a low-tax model, it’s helpful to know that the smaller a car is, the lower its emissions normally are, while diesel models typically have lower CO2 emissions than petrol equivalents, so you can find bigger diesel cars that still cost £20 to tax than petrol models.

A final thing to bear in mind is that some cities have introduced additional charges for driving diesel cars in certain areas, which particularly affects older models registered before September 2015. As a result, it’s worth gauging whether these zones affect you. Whether or not a diesel is right for you will depend on a number of factors, so read our petrol vs diesel guide, to decide which is best for you.

1. Hyundai i10

Our pick Hyundai i10 1.0 Premium
Used deals from £5,899
Monthly finance from £138.76*

Hyundai makes some very well-rounded small cars. One such model is the previous generation i10, which was on sale from 2013 to 2019, and it is a genuinely appealing alternative to popular small cars such as the Peugeot 108 and Skoda Citigo. Key to its appeal is its low running costs. Road tax comes in at £20 per year and Hyundai offered the i10 with a number of frugal petrol engines, with all qualifying for low insurance groups. While a low insurance group does not guarantee that you will have a cheap premium, it should help.

Despite its small dimensions and low price, the Hyundai i10 is surprisingly refined and comfortable - making it a good all-round car. The i10 handles well on faster roads like 60mph B-roads and 70mph motorways, too, which can often be the undoing of smaller cars due to their low power and tendency to be blown around when passing lorries. Even so, the i10 is most at home in town, as it is a doddle to park and all the controls are nice and light, so they don’t take much effort to use.


2. BMW 2 Series

Our pick BMW 220d Coupe M Sport
Used deals from £9,995
Monthly finance from £183.87*

Who said that cars that cost £20 per year to tax have to be boring? Despite its low emissions, the previous-generation BMW 2 Series is one of the most fun, relatively affordable sports cars around. You will need to look for a 220d model, which has a relatively powerful diesel engine. If you want sporty looks, we'd recommend finding an 220d in M Sport specification, as these come with more racy alloy wheels and exterior styling.

BMW also made a convertible version of the 220d and this is great if you want wind-in-your-hair motoring. Even though coupe and convertible versions of the 2 Series are technically four-seaters, the rear seats are quite small. So they are best reserved for occasional use, or for children or luggage. There are both manual and automatic gearboxes to choose from with the 220d and if the idea of an automatic appeals, we’d strongly recommend it, as it is really rather good.


3. Mazda 6 Tourer

Our pick Mazda 6 Tourer 2.2d
Used deals Limited stock

The Mazda 6 Tourer estate is something of a hidden gem. Typically, it's pricier estates such as the BMW 3 Series Touring, Audi A4 Avant and Mercedes C-Class Estate that are seen as desirable medium estate cars, but there is good reason to include the Mazda, as it delivers an awful lot of what these three rivals promise and is far more affordable. It feels high quality, it looks sharp and it's packed with tonnes of standard equipment.

One area the Mazda 6 is particularly strong in is how it handles around corners - it feels agile, has precise steering and offers plenty of grip on country roads, while remaining comfortable. The 6 should also be affordable to run as some 150hp 2.2-litre diesel models come with £20-per-year road tax.

Sport Nav models are the exception here, as their bigger wheels increase the CO2 emissions and the road tax cost. However, if you go for a saloon Sport Nav model with the same 150hp engine, that'll only cost £20 to tax, so could be worth considering if you can live with its less practical boot.


4. Mercedes GLA

Our pick Mercedes GLA 200d Sport
Used deals from £12,995
Monthly finance from £248.06*

If you're after a compact but high-riding upmarket car, the Mercedes GLA is a great option. It's like a tall version of the previous-generation A-Class hatchback, and as it has been replaced with a new model, prices for used versions are going down. This makes it better value than before, which is important, as it was pricey when new.

To qualify for £20 per year road tax, you will need to get a diesel-powered model, specifically a ‘200d’, which is one of the lower power options. As for trims, there are a number of different ones to choose from, including SE, Sport Premium, AMG Line and a handful of special editions. If you want sporty styling, then AMG Line is the one to go for, while SE versions should be amongst the most affordable, as they come with less standard equipment.


5. Mini Hatchback

Our pick Mini Hatchback Cooper
Used deals from £7,995
Monthly finance from £161.03*

Few cars offer as much fun behind the wheel as a Mini does but that isn’t the car's only selling point. Its interior is funky yet high quality and depending on which model you go for, the running costs should be nice and low. In contrast to many cars on this list, there are both petrol and diesel options that fall into the £20-per-year tax band. If you would like petrol power, then ‘One’ or ‘Cooper’ are the models to shop for.

If your budget can stretch to a Cooper we’d recommend it, as One versions are less well equipped and slower, although they do make up for this somewhat by being more affordable. If you are open to a diesel car, then sporty Cooper SD models also qualify for £20-per-year road tax. These are powerful enough to go from 0 to 62mph in a quick 7.3 seconds, and have a good blend of performance and fuel economy.


6. Peugeot 3008

Our pick Peugeot 3008 1.6 BlueHDi Allure
Used deals from £7,400
Monthly finance from £207.07*

Peugeot has been making some cracking cars in recent years. One of the best is the current 3008, which was launched in 2017. In short, it has a great interior, a cracking choice of fuel-efficient engines and funky styling. It is such a well-rounded package that the 3008 is one of the best crossovers available. High praise indeed, as there are loads of crossovers available - the Hyundai Kona, Seat Ateca, Ford Kuga and Vauxhall Grandland X are just four alternatives.

If you want to drive a 3008 which is just £20 per year to tax, then there is a very narrow window of cars to choose from, but if you are prepared to do some digging the rewards are worth it. You will need to hunt for a 2017 1.6-litre diesel model registered before April 2017, as those registered afterwards cost more to tax.


7. Renault Kadjar

Our pick Renault Kadjar 1.5 dCi 110 Dynmique S Nav
Used deals from £8,971
Monthly finance from £162.00*

The Renault Kadjar is a similar size car to the Peugeot 3008, so is a great option for those who need plenty of interior and boot space but who don't want a huge car. Despite being larger than cars such as the Ford Focus, the Kadjar is still very easy to drive. It should also be affordable to run, too, thanks to a range of frugal engines.

Underneath the bodywork, the Kadjar is largely based on the Nissan Qashqai, as Renault and Nissan are part of the same conglomerate. This is no bad thing, as the Qashqai is an excellent base to build upon. If you want to pay no more than £20 per year in road tax, then you will need to look for a 110hp 1.5-litre diesel version. Depending on specification, you can make further savings as certain Dynamique Nav models qualify for zero road tax.


8. Jaguar XE

Our pick Jaguar XE 2.0d R-Sport
Used deals from £11,700
Monthly finance from £256.80*

Back in 2015 Jaguar took on the impressive BMW 3 Series with the XE. Long story short, the XE is a great car, especially if you want a model that looks great and offers agile handling around corners. When driving at higher speeds, the XE feels very planted, giving a driver plenty of confidence when cornering, while remaining impressively comfortable.

There are a handful of trims that qualify for £20-per-year road tax, including Prestige, Portfolio and R-Sport, although whichever you pick, you'll need to go for the frugal 180hp 2.0-litre diesel engine rather than one of the more powerful options. Even so, this engine provides plenty of punch for most drivers, with the additional payoff of strong fuel economy.