Best used tax-exempt cars

Whether you're looking for a seven-seat people carrier or a sporty hatchback, there's a tax exempt car for you

BuyaCar team
Feb 11, 2022

They say death and taxes are two things you can't avoid, but in the case of road tax it is possible to avoid paying anything at all - if you buy the right car that is. All you need to do is buy a car that was built and registered before 1 April 2017, and produces 100g/km of CO2 or less and you will be tax-exempt.

Cars of that age are taxed under the old system, which was based entirely on carbon dioxide (CO2) emissions, with lower-emitting models placed in a lower-cost tax band.

Even when you've achieved tax-free status, you'll still have to go through the process of taxing the car but you don't actually have to pay anything. Cars first registered from 2001 to March 2017 have the potential to qualify for tax exemption and you can check the registration date of any car by asking the seller.

The majority of cars this age producing 100g/km CO2 or less tend to be diesel-powered, but in the case of diesel, while they may well be tax-exempt, it’s worth taking care to ensure that the money you save on tax isn’t swallowed up by regular ULEZ or clean-air-zone payments if you live in a city centre. If you can find a tax-exempt car that also meets the Euro 6 emissions standard then you can ensure you'll be in the clear.

Every new car registered since September 2016 and many before this date, will be Euro 6 compliant, so your best bet is to make the most of used car deals on models registered between September 2016 and April 2017.

If you’d prefer a wider choice, though, you don't have to stick to cars that reduce your tax bill to zero. There are plenty of excellent cars with low emissions on the market that require you to pay no more than £30 in road tax. Look for cars emitting less than 120g/km CO2, or browse from our list of cars with low road tax.

Tax-exempt cars: don’t get caught out

  • Buying a vehicle with bigger wheels can increase emissions and make it liable for tax.
  • Zero tax cars may use expensive technology to cut emissions. It may be cheaper to buy a less efficient model and pay £10 or £20 in car tax each year.
  • Hybrid cars have low emissions but can be expensive. They are often most efficient for town driving.
  • Even if it’s exempt, you still have to tax your car every year.    

Best used tax-exempt cars

1. Skoda Octavia Estate

Best used tax-exempt car for luggage lugging

Our pick Skoda Octavia Estate 1.6 TDI CR 110 Greenline
CO2 90g/km Fuel economy 81mpg
Used deals Limited stock

The Skoda Octavia Estate defies people’s expectations of a low-polluting car: it’s spacious, with five seats that can all fit adults, a vast amount of luggage space and decent performance. The standard 1.6-litre diesel car is tax-free, emitting 99g/km, but more economical still is the ultra-efficient Greenline version. If the estate is too big, the hatchback version of the Octavia is just as efficient, and can be cheaper, too.


2. Nissan Qashqai

Best used tax-exempt car for low running costs

Our pick Nissan Qashqai 1.5 dCi
CO2 99g/km Fuel economy 74mpg
Used deals from £9,995
Monthly finance from £163*

Crossovers are meant to offer the low running costs of a family hatchback, combined with the higher driving position of an off-roader, and that’s what this diesel-powered Nissan Qashqai delivers. It’s one of the most popular crossovers that you can buy, thanks to the smooth way it drives. There's decent fuel economy and free car tax when fitted with a 1.5-litre diesel engine and wheels that are smaller than 19 inches.


3. Citroen Grand C4 Picasso

Best used tax-exempt car for a relaxing ride

Our pick Citroen Grand C4 Picasso 1.6 BlueHDi
CO2 99g/km Fuel economy 74mpg
Used deals Limited stock

This Citroen is one of the few seven-seaters that qualify for zero car tax. Fortunately, the lack of choice doesn’t mean getting a raw deal, because the Grand C4 Picasso people carrier is a top pick. It’s comfortable and practical, thanks to its flexible seats and an interior pock-marked with storage areas. This version is a little slow - it’s best for driving at a relaxing pace and enjoying the view from the huge windows.


4. Mini Cooper D

Best used tax-exempt car for fun

Our pick Mini Cooper D Hatchback 3-door
CO2 92g/km Fuel economy 81mpg
Used deals from £8,995
Monthly finance from £200*

The Mini Cooper D proves you don’t have to forgo driving enjoyment for zero car tax. It might be efficient, but it still feels like a Mini, with zippy acceleration and plenty of grip, so the car turns just as much as you need it to when you move the steering wheel. The three-door is more stylish, but the more practical five-door car is also tax-exempt. 


5. Toyota Prius

Best used tax-exempt car for economical town driving

Our pick Toyota Prius 1.8 VVT-i
CO2 70g/km Fuel economy 94mpg
Used deals from £13,999
Monthly finance from £234*

The original hybrid is still one of the best. Toyota’s Prius recovers energy that would otherwise be lost while slowing down, stores it in a battery and then uses it to power the car at slow speeds and under acceleration. Official mpg figures are close to 100mpg, although most drivers report 60-70mpg as a more expectable figure. Its effectiveness and comfort - particularly in town - is evidenced by the Prius' popularity amongst minicab drivers.


6. Volkswagen Up

Best used tax-exempt car for small size and costs

Our pick VW Take Up 1.0 60PS Bluemotion Technology
CO2 94g/km Fuel economy 69mpg
Used deals from £8,400
Monthly finance from £168*

The VW Up is the best city car on the market, thanks to its spacious interior, that can fit two adults in the back without causing instant cramp. It's small on the outside and light too, so it only needs a small engine to buzz around town. The BlueMotion Technology model is the most efficient, and the cheapest in the range.


7. Jaguar XE

Best used tax-exempt car for style and sportiness

Our pick Jaguar XE 2.0D 163hp Manual
CO2 99g/km Fuel economy 75mpg
Used deals from £14,844
Monthly finance from £293*

Pick this tax-exempt XE in Portfolio trim and you’ll have soft 'Windsor' leather seats, an upgraded Meridian sound system and sat-nav in a car with an official emissions figure of just 99g/km. The XE has a well-judged balance of comfort, combined with agility, stability and grip in corners for a sporty feel. Performance is fairly average to keep emissions in check.


8. Ford Mondeo

Best used tax-exempt car for long-distance driving

Our pick Ford Mondeo 1.5 TDCi ECOnetic
CO2 94g/km Fuel economy 79mpg
Used deals Limited stock

Big on space but low on emissions: the Ford Mondeo’s 1.5-litre diesel engine isn’t just exempt from car tax, but the 94g/km CO2 emissions also help to lower its company car tax (just 1g/km more would have pushed it into a higher band). It's ideal for calm and quiet motorway journeys and makes the hybrid version of the car seem unnecessary. 


9. Vauxhall Astra

Best used tax-exempt car for efficiency without compromises

Vauxhall Astra front

Our pick Vauxhall Astra 1.0i ecoFLEX
CO2 99g/km Fuel economy 66mpg
Used deals Limited stock

The Astra is yet further proof that you don’t have to spend a lot of money or settle for sluggish performance to reduce your car tax bill to zero. It's a well-priced family hatchback that's smooth and nimble in corners. Inside it's built to a high standard that'll be unrecognisable to anyone who remembers Vauxhalls a decade ago. What's more, it's a family hatchback that uses a petrol engine, which is good if you're beginning to question whether you should go for diesel power.


10. BMW 3 Series

Best used tax-exempt car for low company car tax

Our pick BMW 330e
CO2 44g/km Fuel economy 149mpg
Used deals from £16,200
Monthly finance from £329*

The BMW 3 Series is already an expensive car before you add a colossal £8,000 to its price for the plug-in hybrid version. Fortunately, it loses value faster than most other BMWs, which makes it slightly more affordable as a used car.

You can charge it up so that it will drive for up to 30 miles on battery power before a petrol engine takes over. Motor and petrol can combine for swift performance, but its biggest selling point is CO2 emissions of 44g/km: that puts the car in the lowest company car tax band.


*Representative PCP finance - Ford Fiesta:

48 monthly payments of £192
Deposit: £0
Mileage limit: 8,000 per year
Optional final payment to buy car: £2,923
Total amount payable to buy car: £11,926
Total cost of credit: £2,426
Amount borrowed: £9,500
APR: 9.9%

BuyaCar is a credit broker, not a lender. Our rates start from 6.9% APR. The rate you are offered will depend on your individual circumstances.


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