Best cars under £40,000

Best cars under £40,000

Cars over £40K will now include an annual fee of £310 for 5 years, here are the best cars under £40K to dodge the charge.

The new road tax rates that came in in April 2017 contain some peculiar anomalies, not least the fact that all cars costing over £40,000, regardless of their emissions status, will be subject to an annual additional VED charge of £310 a year on top of the standard rate of £140 per annum for the first five years of their lives.

The additional charge is aimed at targeting the most polluting vehicles, but in essence also affects some cleaner cars as well, while also giving a previously non-existent advantage to some models that were hit hard by the previous road tax system.

If you want to beat the road tax blues and enjoy something a bit special, there are some great cars around that are just shy of the £40,000 barrier, of all shapes and sizes.

Here are our top 10:

10. Volvo S90 2.0 D4 R Design Pro

2016 Volvo S90 premium saloon
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Beautifully made, tremendously well-equipped and an absolute pleasure to drive, the S90 is the best Volvo saloon car ever made. There are few cars as spacious, luxurious and relaxing to own as the S90, especially not in the tax-cheating sub-£40,000 price bracket. The R Design Pro is a nice spec as well – with body styling, sports seats and 19-inch alloys included in the £39,865 asking price.

9. Mercedes GLC 220d AMG Line

2015 Mercedes-Benz GLC mid-size SUV
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The first of four sporty SUVs in our top 10, the Mercedes GLC 220d AMG Line weighs in at £38,870, just £130 shy of the government’s £40k penalty point. Yet it also has some smart AMG styling features and an impressive list of standard equipment, while the AMG pack also adds firmer springs and 20-inch alloys. A nine-speed automatic transmission comes as standard.

8. Audi A4 All-Road 3.0TDI 218PS Quattro Sport S-Tronic

2016 Audi A4 All-road quattro SUV-style estate
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Not only does Audi’s sportiest variant of the A4 wagon get one of the longest car names in history, but it also gets one of the longest lists of standard equipment included within its £39,730 list price. Throw in the A4’s traditionally exquisite levels of interior detail and the incredible low-down torque of the 218PS 3.0-litre TDI and you’ve got a lot of clout for the cash.

7. Nissan 370Z NISMO

2015 Nissan 370Z Nismo sportscar
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With 248g/km of CO2 emissions, the £39,375 Nissan 370Z NISMO took a hammering under the old vehicle excise duty system, but under the new regime it costs just £140 a year to tax, with no punitive surcharge as it sneaks under the price limit by £625. It makes the 3.7-litre, 344bhp V6-engined coupe quite an enticing proposition, not least because it’s also a thrilling drive.

6. Range Rover Evoque HSE eD4

2016 Range Rover Evoque compact premium SUV
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The only Range Rover you can own while avoiding the £350 a year tax impact is the Evoque, but in HSE specification it’s still quite a luxurious car. The eD4 may be a two-wheel-drive variant, but it’s every bit as handsome and refined as the 4WD models, and more economical to run, too. At £39,700, it beats the system by £300.

5. Mercedes-Benz E-Class E200d estate AMG Line

Mercedes-Benz E-Class Estate premium estate
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The E-Class is one of the finest estate cars on the market – if not THE finest – and in £39,720 AMG Line form benefits from uprated sports suspension, along with a front spoiler, side skirts, 19-inch alloys, a three-spoke steering wheel, ventilated brake discs and unique AMG sports seats. It’s a handsome package, and a terrific car to drive, as well as being eminently practical.

4.  Alfa Romeo Stelvio 2.2d 210 Super AWD

2017 Alfa Romeo Stelvio mid-size SUV
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Coming in at £38,490, the new kid on the SUV block beats the punitive new road tax rules by a comfortable margin, even in high spec Super 210PS form. The Alfa Romeo Stelvio is a real drivers’ SUV, too. Despite its raised ride height, it has excellent road manners, terrific steering and a cabin inspired by that of the jaw-dropping Giulia. Finally, an Alfa Romeo you can buy with your head as well as your heart.

3. BMW 520d M-Sport

2017 BMW 5 Series M-Sport premium executive saloon
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You can’t go far wrong with a BMW 5-Series, especially not the latest generation, which is packed with tech yet remains one of the most rewarding drivers’ cars ever made. The 520d M-Sport costs £39,835, so just about squeezes in under our £40k ceiling. In this context, its compelling blend of luxury, refinement, performance and luxury make it impossible to beat. It’s the best executive car on the market today.

2. Jaguar F-PACE 2.0d Portfolio

2016 Jaguar F-PACE Portfolio premium SUV
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Talking of class leaders, the Jaguar F-PACE is another car that’s nigh on impossible to beat in its class. At £39,730, the range-topping two-wheel-drive model gets incredible levels of equipment for the money, including a panoramic glass roof, perforated leather seats, keyless entry and built-in wi-fi hotspot. It also has class-leading residual values.

1. Ford Mustang 5.0 V8 Shadow Line GT

2015 Ford Mustang V8 Fastback sports car
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The standalone winner in the tax avoidance stakes is the Ford Mustang – a 5.0-litre V8 coupe that you can tax for just £140 a year is a real anomaly under the new VED road tax system, yet the 5.0 GT Shadow Line model can be yours for £39,895, within budget by £105. It may not be as technologically advanced or as sensible as some of the other cars in this list, but it’s…. a V8 Mustang. What more do you want?

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