Which Cars Have Low Road Tax?

Understanding UK Road Tax (Vehicle Excise Duty)

When considering which cars have low road tax, it's crucial to understand how Vehicle Excise Duty (VED) operates in the United Kingdom. VED, commonly known as road tax, is a tax levied on most vehicles used on public roads. The amount payable is primarily determined by a vehicle's CO2 emissions and its fuel type, although specific rules apply to different registration dates. For cars registered since April 2017, the system is tiered, with a standard rate for most vehicles and a higher rate for those with list prices over a certain threshold in their first year. This banding system is designed to encourage the adoption of more environmentally friendly vehicles.

The core principle behind VED is to incentivise drivers to choose cars that produce fewer harmful emissions. Generally, the lower a car's carbon dioxide (CO2) output, the less road tax you will pay. This means that vehicles with very low or zero emissions, such as electric cars and some hybrid models, often benefit from significantly reduced or even zero VED, especially in their initial years. However, understanding the specific bands and how they apply to different vehicle types and registration dates is key to making an informed choice.

• Road tax (VED) is based on CO2 emissions and fuel type.
• Newer cars (post-April 2017) use a tiered banding system.
• Zero-emission vehicles typically have the lowest tax rates.
• Understanding VED bands is key to tax-efficient car ownership.

How VED is Calculated for Different Registration Dates

The method for calculating VED has evolved, meaning the rules for cars registered before and after specific dates differ significantly. For vehicles registered between 1 March 2001 and 31 March 2017, the VED rate is determined by a CO2 emissions band. Cars with emissions up to 100g/km were taxed free, while higher emissions bands incurred progressively higher annual fees. This system made many smaller, more fuel-efficient petrol and diesel cars very cheap to tax.

For cars registered on or after 1 April 2017, the system changed. All new petrol and diesel cars are subject to a 'first-year rate' based on CO2 emissions, which is typically higher. After the first year, they move to a standard rate. Electric vehicles registered between 1 April 2017 and 31 March 2025 are exempt from the standard VED charge, placing them firmly in the low road tax category. However, cars with a list price exceeding £40,000 at the time of registration, regardless of fuel type, attract a 'premium' supplement for five years (from the second to the sixth year), meaning even some low-emission or electric cars can incur additional costs if they are high-value models.

Key Factors Influencing Road Tax Costs

Several factors dictate how much road tax a car owner will pay. The most significant is the vehicle's CO2 emissions figure, measured in grams per kilometre (g/km). This figure is part of the vehicle's type approval and is usually found on the manufacturer's specification sheet or the vehicle's V5C logbook. A lower g/km figure directly translates to a lower VED band and, consequently, a lower annual tax cost.

Fuel type also plays a role, particularly for vehicles registered before April 2017 where different rates applied. However, for cars registered since April 2017, the primary distinction is between zero-emission vehicles (like full electric cars) which benefit from exemptions, and traditional petrol or diesel vehicles, whose tax is solely based on their CO2 output. The purchase price (list price) of a car matters for the first year's VED and the subsequent premium rate for higher-value vehicles, adding another layer to the calculation for cars registered from April 2017 onwards.

Always verify a car's exact CO2 emissions figure and VED band before purchase, as manufacturer claims can sometimes differ slightly from official figures, and specific trims may have varied emissions.

Zero and Ultra-Low Emission Vehicles: The Tax Champions

When searching for cars with low road tax, zero and ultra-low emission vehicles stand out as the most beneficial choices. These include fully electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs) that meet stringent CO2 emission thresholds. For EVs registered on or after 1 April 2017, the current exemption from the standard VED charge means they cost nothing to tax annually. This makes them the undisputed leaders in the category of low road tax vehicles.

Plug-in hybrids, while not having zero emissions, often qualify for lower tax bands due to their reduced CO2 output compared to conventional petrol or diesel cars. The specific tax rate for a PHEV depends on its CO2 emissions and its ability to run on electric power for a certain distance. Cars emitting 1-50g/km and capable of travelling over 70 miles on electric power are in the lowest VED bands, often qualifying for a discount. However, it's essential to check the specific CO2 figure and electric-only range, as these can vary significantly between models and affect their tax classification.

Electric Cars: The Ultimate Tax Saver

Fully electric cars are the pinnacle of low road tax ownership. Since April 2017, the government has provided a significant incentive by exempting all zero-emission electric vehicles from the standard VED charge. This means that whether you drive a compact city EV or a larger electric SUV, your annual road tax bill will be £0. This exemption is a powerful draw for drivers looking to minimise running costs and environmental impact. Remember, this applies to the standard rate; the £40,000 list price supplement for premium electric vehicles still applies for the first five years of registration if the car exceeded that price point when new.

Plug-in Hybrids and Low Emission Petrol/Diesel

Beyond full EVs, plug-in hybrid vehicles offer a compromise for those not ready for full electric. Their tax bands are determined by CO2 emissions and electric-only range. For example, a PHEV emitting between 1-50g/km with an electric range of 70 miles or more will likely fall into Band A (£0 tax), provided it was registered after April 2017. Those with lower electric ranges or slightly higher emissions might fall into Bands B, C, or D, still offering significant savings over conventional cars.

For drivers who prefer traditional petrol or diesel engines, or for those who cannot yet fully transition to electric, choosing a car with naturally low CO2 emissions is paramount. For vehicles registered before April 2017, cars emitting 100g/km or less were taxed for free. For models registered from April 2017, focusing on the lowest available CO2 figures within the petrol/diesel categories will lead to lower standard rates. Cars often found in lower tax bands include smaller city cars, superminis, and some compact family cars known for their fuel efficiency.

The transition towards lower VED bands is driven by a clear government policy to reduce vehicle emissions, making greener choices financially advantageous.

Cars Registered Before April: A Different Tax Landscape

The system for calculating road tax has seen substantial changes, particularly for vehicles registered before April 2017. For these cars, the VED rate is determined solely by their CO2 emissions band, as published in the vehicle's registration documents. This older system generally offered more favourable tax rates for a wider range of vehicles, including many efficient petrol and diesel models, compared to the current system's first-year rates for similar vehicles.

Under the pre-April 2017 rules, cars emitting 100g/km or less of CO2 were exempt from paying any VED. This threshold made many popular smaller cars, particularly those with advanced engine technology for their time, incredibly cheap to run from a tax perspective. As emissions increased, so did the tax band, with higher CO2 outputs resulting in progressively higher annual costs. For example, cars emitting between 101-110g/km might have faced a modest annual fee, while those exceeding 200g/km incurred significant charges.

Finding 'Free Tax' Cars from the Older System

If you are looking at used cars registered before 1 April 2017, the goal is to find a model with official CO2 emissions of 100g/km or less. Many manufacturers produced models that achieved this benchmark, often in their smaller engine variants or specific 'eco' versions. These can include superminis like the Ford Fiesta, Volkswagen Polo, or Vauxhall Corsa, as well as some more economical family cars and compact SUVs. It's vital to check the specific CO2 emissions for the exact trim level and engine variant you are considering, as these figures can vary.

The advantage of these older 'free tax' cars is that their VED remains £0 annually, regardless of the current year. This can present a significant saving over the lifetime of the vehicle compared to newer cars that might have a lower first-year tax but a higher standard rate after that. However, it's important to balance this saving against other potential costs, such as maintenance, fuel efficiency, and whether the vehicle meets current emissions zone requirements (like London's ULEZ) if applicable to your driving needs.

→ Car Tax Paperwork: What You Need for UK Vehicle Registration

The Impact of Engine Size and Fuel Type (Pre-2017)

Prior to the VED changes, engine size and fuel type sometimes influenced tax bands, although CO2 emissions became the primary determinant. For instance, cars with larger engines (typically over 1.5 or 2.0 litres) often produced more CO2 and therefore fell into higher tax brackets. Similarly, older diesel technology could sometimes result in higher emissions than advanced petrol engines, though this was not a universal rule. The focus for low road tax in this era was squarely on achieving low CO2 figures, often through smaller engine displacements and efficient engineering.

When exploring the used market for cars registered before April 2017, consult the DVLA's VED tables or use online VED calculators that allow you to input a registration date and CO2 emissions to see the applicable tax band. This will help you identify models that not only had low road tax when new but continue to do so today. The key is to look for that magic figure: 100g/km or below for zero VED.

When buying a used car registered before April 2017, always confirm its CO2 emissions from the V5C logbook or the manufacturer's specification sheet to ensure it still qualifies for zero road tax.

Cars Registered From April: Navigating New VED Bands

For vehicles registered from 1 April 2017 onwards, the road tax system underwent a significant overhaul, introducing a tiered structure that separates the first year's charge from subsequent years. This new system aims to be more reflective of a car's environmental impact over its lifetime, particularly by incentivising the purchase of zero-emission vehicles. Understanding these bands is essential for anyone looking for cars that qualify for low road tax under current regulations.

The first-year VED rate is based on CO2 emissions, with higher emissions attracting higher charges. Following this, from the second year onwards, most petrol and diesel cars pay a flat standard rate. This standard rate is currently the same for all petrol and diesel cars, regardless of their CO2 emissions, but it does not apply to zero-emission vehicles. The crucial point for low road tax seekers is that electric cars remain exempt from this standard charge, while cars exceeding a £40,000 list price incur an additional 'premium' supplement for five years (years two to six).

The Standard Rate and Premium Surcharge Explained

After the first year, most petrol and diesel cars registered since April 2017 are subject to a standard VED rate. As of recent regulations, this standard rate is a fixed amount applicable to all vehicles in this category. This means that a small, economical petrol car and a larger, less efficient petrol car will pay the same standard annual tax once they are over one year old, provided neither is a zero-emission vehicle. This change effectively removes the incentive for choosing highly efficient petrol/diesel cars solely on their post-first-year tax benefit.

However, a significant consideration for higher-value cars is the 'premium' VED supplement. If a car's list price (including optional extras) was over £40,000 when it was first registered, an additional charge is added to the VED bill for five years, starting from the second year of registration. This supplement applies whether the car is petrol, diesel, hybrid, or even electric, effectively increasing the road tax for premium models. This means that even some highly efficient or electric cars can end up with a higher total VED than a cheaper, less efficient petrol or diesel model if the latter's price is below the £40,000 threshold.

CO2 Emissions Bands for First-Year Tax

The first-year VED rate for petrol and diesel cars registered from April 2017 is determined by a sliding scale of CO2 emissions. The bands range from Band A (0g/km) for zero-emission vehicles (which are effectively £0 tax, but subject to the premium supplement if applicable) up to Band M and beyond for cars emitting over 255g/km. For example, cars emitting 1-50g/km that also have a zero-emission range of at least 70 miles (i.e. qualifying PHEVs) are in Band A and pay £0 for the first year. Cars emitting 51-75g/km in Band B also pay £0 for the first year.

As CO2 emissions increase, so does the first-year tax. Cars emitting 76-90g/km are in Band C and pay a modest amount, while those emitting 91-100g/km in Band D also incur a relatively low charge. For cars emitting 101-110g/km (Band E), the first-year tax increases further, and so on. It is essential to consult the official DVLA VED tables or use an online calculator for the most accurate figures for any specific car, as these bands and rates can be subject to change.

When comparing new cars, always check the 'first-year VED' and the 'standard rate' to get a full picture of your annual tax commitment, especially if considering models priced near the £40,000 premium threshold.

Identifying Low Road Tax Cars: Practical Steps

To pinpoint cars that offer low road tax, a systematic approach is essential. It involves understanding the VED system applicable to the car's registration date and then actively researching specific models and their corresponding emissions figures. Armed with this knowledge, you can make informed decisions that align with your budget and environmental considerations.

The first step is always to determine the vehicle's registration date. If it's before 1 April 2017, you're looking for a car with CO2 emissions of 100g/km or less. If it's on or after 1 April 2017, you need to consider both the first-year rate (based on CO2) and the standard rate, paying close attention to whether the car is zero-emission or has a list price over £40,000.

Using Online Resources and Calculators

The UK government provides official resources to help drivers check VED. The DVLA website offers tools where you can enter a vehicle's registration number to find out its current VED band and amount due. This is invaluable when viewing a specific used car. For new cars or potential purchases, manufacturers' websites and reputable car review sites will list CO2 emissions figures and often indicate the applicable VED band or first-year tax cost.

There are also numerous independent VED calculators online. These tools allow you to input a car's registration date, CO2 emissions, and sometimes its list price (for newer vehicles) to estimate the annual road tax. While these are generally accurate, always cross-reference with official DVLA information if possible, especially for high-value or borderline cases. Looking for vehicles consistently appearing in the lowest CO2 bands (e.g., under 100g/km for older cars, or zero emissions for newer ones) is the most reliable strategy.

What to Look For in Car Specifications

When browsing car specifications, whether online or in brochures, pay close attention to the 'CO2 Emissions' figure, usually stated in g/km. For cars registered before April 2017, aim for models with 100g/km or below. For cars registered after April 2017, look for zero-emission vehicles (EVs) to qualify for £0 standard VED. If considering a plug-in hybrid, check both its CO2 emissions and its official electric-only range. A higher electric range generally helps secure lower tax bands.

Also, be aware of the car's list price if it's a newer model. If the original list price (including all factory-fitted options) was over £40,000, you will face the premium supplement for the first five years of the standard VED period. This can add hundreds of pounds annually, so it's a critical factor for high-end vehicles. Understanding these specific metrics will guide you towards genuinely low road tax options.

The financial incentive for choosing low-emission vehicles is a significant factor in the total cost of ownership, beyond just fuel and purchase price.

Types of Cars Typically Offering Low Road Tax

When seeking cars with low road tax, certain categories consistently offer the best value. These are generally vehicles designed with efficiency and reduced environmental impact at their core. By understanding these categories, you can narrow down your search effectively and find models that align with your desire for lower running costs.

→ When Does a Car Become Tax Exempt?

The most prominent category is, without doubt, fully electric vehicles (EVs). For cars registered since April 2017, these have £0 standard VED. Plug-in hybrid electric vehicles (PHEVs) also frequently qualify for low tax bands, especially those with longer electric ranges and lower CO2 emissions. Beyond hybrids and EVs, smaller, fuel-efficient petrol and diesel cars, particularly those registered before April 2017 with low CO2, are also strong contenders for minimal road tax.

Electric Vehicles (EVs)

As mentioned, EVs are the champions of low road tax. Their zero tailpipe emissions mean they are currently exempt from the standard VED charge for cars registered from April 2017 onwards. This exemption translates directly into an annual saving of the standard VED amount, which is a substantial benefit. The purchase price is a factor for the first year's tax and the potential premium supplement if the list price exceeded £40,000, but for the majority of EVs, the ongoing VED cost is £0.

Plug-in Hybrid Electric Vehicles (PHEVs)

PHEVs offer a balance between electric driving and traditional engine power, and many are designed to achieve low VED. For a PHEV to qualify for the lowest tax bands (including £0 for the first year and potentially low standard rates), it typically needs to have CO2 emissions below 50g/km and an electric-only range of at least 70 miles (for cars registered from April 2017). While their VED isn't always £0 after the first year like full EVs, it's often significantly lower than comparable petrol or diesel cars, making them a tax-efficient choice.

Small Petrol and Diesel Cars (Especially Pre-2017)

For those looking at the used market or favouring traditional engines, smaller petrol and diesel cars registered before April 2017 that emit 100g/km or less are excellent low-tax options. These often include city cars, superminis, and some compact family hatchbacks. Examples might include models like the Toyota Yaris, Honda Jazz, or specific variants of the Volkswagen Golf or Ford Focus known for their efficiency. Their advantage is that their VED remains £0 indefinitely as long as they meet the CO2 criterion.

Even for cars registered from April 2017, smaller petrol and diesel engines that achieve the lowest possible CO2 emissions within their class will attract lower first-year VED. While the standard rate is flat, minimising the initial tax charge can still be a consideration. Look for cars with CO2 figures in the lower bands (e.g., 101-110g/km or 111-125g/km), rather than those in higher emission brackets.

When considering a PHEV, check its official electric-only range. A longer range is crucial for qualifying for the lowest tax bands and maximising your potential fuel savings.

Factors That Can Increase Road Tax

While the focus is on low road tax, it's equally important to be aware of the factors that can lead to higher VED charges. Understanding these potential pitfalls can help you avoid unexpected costs and make a more informed decision when purchasing a vehicle.

The primary drivers for increased road tax are high CO2 emissions, being a petrol or diesel vehicle registered from April 2017, and having an original list price exceeding £40,000. For older vehicles, higher engine capacity or less efficient technology could also contribute to greater emissions and thus higher tax, though the primary determinant has always been CO2 for the majority of vehicles.

High CO2 Emissions

The most direct route to higher road tax is a high CO2 emissions figure. For cars registered before April 2017, exceeding the 100g/km threshold meant paying an annual fee, which increased significantly with each higher emission band. For cars registered from April 2017, high CO2 emissions result in a substantially higher first-year VED charge. While the standard rate for petrol/diesel is flat, the initial purchase price and subsequent VED are heavily influenced by emissions.

Premium Price Threshold (£40,000 List Price)

For vehicles registered on or after 1 April 2017, the £40,000 list price threshold is a significant factor for increasing VED. If a car's original list price, including all factory-fitted options, exceeded this amount, it will be subject to an additional 'premium' VED supplement for five years, starting from the second year of registration. This supplement is added on top of the standard VED rate. This means that even an electric or highly efficient hybrid car could end up costing more in road tax than a cheaper petrol or diesel car if it falls into this premium category.

Fuel Type and Registration Date Combination

The combination of fuel type and registration date is critical. While zero-emission EVs registered from April 2017 benefit from £0 standard VED, their petrol or diesel counterparts registered under the same rules face the standard annual rate (after the first year). Older petrol and diesel cars (pre-April 2017) that were very efficient might have had £0 VED due to low CO2 emissions, whereas newer petrol/diesel cars, even if efficient, will pay the standard rate. Conversely, older, less efficient petrol/diesel cars could incur higher tax than newer efficient ones if they fall into higher CO2 bands under the older system.

It's also worth noting that some older diesel cars registered before April 2017 might have faced a higher VED if they did not meet certain particulate emission standards, though CO2 was still the primary factor. For current purchasing decisions, the focus remains on CO2 for the first-year tax and the £40,000 threshold for the premium supplement, with electric vehicles offering the clearest path to zero ongoing VED.

Be wary of cars with high original list prices, as the £40,000 premium supplement can negate savings from otherwise low-emission technology.

Does Road Tax Automatically Renew?

The question of whether road tax automatically renews is a common one, and the answer is generally no, you must actively tax your vehicle. Unlike some other subscriptions or services, the DVLA does not automatically renew your vehicle's tax. You will receive a reminder, but it is your responsibility to ensure your car is taxed before the expiry date.

Failure to tax your vehicle can result in penalties, including a significant fine and the inability to use the vehicle on public roads. If a vehicle is not taxed, it must be declared as off the road using a Statutory Off Road Notification (SORN) if it is kept on private land. Driving or parking an untaxed vehicle on a public road is illegal.

How to Tax Your Vehicle

There are several convenient ways to tax your vehicle. The quickest and easiest method is usually online via the GOV.UK website. You will need your vehicle's registration number and a valid MOT test certificate if your vehicle requires one. For cars over three years old, an up-to-date MOT is a prerequisite for taxing. If your vehicle requires an MOT, you can usually tax it online from the day it passes.

Alternatively, you can tax your vehicle by calling the DVLA's automated service or by visiting a Post Office branch that offers vehicle tax. When using these methods, you will typically need your V5C logbook (or the V11 reminder letter which contains a barcode). For vehicles that are not required to have an MOT (e.g., new vehicles in their first three years), the process is often simpler.

What Happens If You Don't Tax Your Car?

If your vehicle's tax expires and you do not renew it, it will be automatically registered as untaxed by the DVLA's system. You can then no longer legally drive or park it on a public road. If you intend to keep the vehicle off the road, you must declare it SORN. If you are caught driving an untaxed vehicle on a public road, you can face an enforcement fine of £80, which can be reduced to £40 if paid promptly. Furthermore, the vehicle may be clamped or even removed.

→ Diesel Car Tax Explained: UK Costs & How They Work

The DVLA uses automated number plate recognition (ANPR) technology to identify untaxed vehicles. Therefore, it is crucial to ensure your vehicle is taxed promptly. If you have recently purchased a car, you will need to tax it in your name as part of the registration process, unless the seller has already taxed it for you.

Set a reminder in your phone or calendar a week before your road tax is due to expire to ensure you have ample time to renew it and avoid any penalties.

Comparing Car Tax for Different Vehicle Types

When comparing cars, understanding how their tax liabilities differ based on type is vital for long-term cost management. The Vehicle Excise Duty (VED) system is structured to encourage certain types of vehicles over others, primarily those with lower environmental impact.

The most significant tax differences arise between fully electric vehicles, plug-in hybrids, conventional petrol and diesel cars, and older vehicles. Each category has unique rules and rates that impact the annual cost of keeping a vehicle on the road.

Electric Vehicles (EVs) vs. Plug-in Hybrids (PHEVs)

Electric Vehicles (EVs): For EVs registered on or after 1 April 2017, the standard annual road tax is £0. This is a major financial benefit, making them the cheapest to tax on an ongoing basis. The only potential cost is the premium supplement if the car's original list price exceeded £40,000.

Plug-in Hybrid Electric Vehicles (PHEVs): PHEVs offer a mixed tax profile. Their first-year VED depends on their CO2 emissions and electric range. Many qualify for Band A (£0 tax) in the first year if they emit 1-50g/km and have an electric range of over 70 miles. Post-first year, their tax rate depends on their CO2 emissions band. If they fall into Band A/B (0-50g/km), they may still qualify for a significantly reduced rate or even £0 tax, but this is less guaranteed than for pure EVs. Cars with higher emissions or shorter electric ranges will pay more.

Petrol and Diesel Cars (Post-2017)

Cars with traditional petrol or diesel engines registered from 1 April 2017 have a first-year VED based on their CO2 emissions, which can be substantial for higher emitters. After the first year, they all fall onto a flat standard rate, which is currently the same for all petrol and diesel cars. This means that the ongoing tax cost is the same regardless of whether you choose a very economical small engine or a more powerful one, provided the car's original list price was below £40,000. The main tax consideration for these vehicles is the initial first-year charge.

Petrol and Diesel Cars (Pre-2017)

For petrol and diesel cars registered before 1 April 2017, the VED is solely based on CO2 emissions. Those emitting 100g/km or less are taxed at £0 annually, making them very attractive for used car buyers. Cars with higher CO2 emissions will pay an annual fee that increases with each emission band. This system allowed many efficient small cars to be tax-free indefinitely, a benefit that newer, even if equally efficient, petrol/diesel cars do not share due to the new standard rate.

A table summarising typical tax liabilities can illustrate these differences:

When buying a used car registered before April 2017, prioritize models with CO2 emissions of 100g/km or less for lifelong free road tax.

Disability Car Tax Exemptions

For individuals with disabilities, there are specific exemptions available that can significantly reduce or eliminate the road tax burden. This scheme, known as the disability exemption, is administered by the DVLA and allows eligible individuals to claim a full exemption from paying VED on a qualifying vehicle.

To qualify for disability car tax exemption, you must be receiving a qualifying mobility allowance. This ensures that the exemption is targeted at those who genuinely need a vehicle to support their mobility needs due to a disability. The vehicle must be registered in the name of the disabled person or their trustee, or used by the disabled person. The vehicle must also be used solely for the benefit of the disabled person.

Who Qualifies for Disability Car Tax Exemption?

Eligibility for the disability exemption is based on receiving certain mobility allowances. These include the Higher Rate Mobility Component of Disability Living Allowance (DLA), the Enhanced Rate Mobility Component of Personal Independence Payment (PIP), or the War Pension Mobility Supplement. You can also qualify if you receive the Armed Forces Independence Payment (AFIP).

If you receive one of these allowances, you can claim an exemption for one vehicle. If you do not receive these allowances but have a disability that makes it difficult to use public transport, you may still be able to claim if you are over the state pension age and receive Attendance Allowance. The vehicle must be registered in the disabled person's name, or if they are under 16, in the name of a parent or guardian. The vehicle must be adapted for the disabled person's needs or used to transport them.

How to Claim Disability Car Tax Exemption

Claiming the exemption is a straightforward process. You can apply by phone or by post. You will need to provide details of your mobility allowance and the vehicle you intend to tax. If you are applying by post, you will need to send your V5C registration certificate and your proof of entitlement to the mobility allowance to the DVLA. If you are using the Motability scheme, your lease agreement usually covers the road tax, and Motability handles the exemption process on your behalf.

It is important to note that if the vehicle is used for purposes other than the benefit of the disabled person (e.g., a spouse uses it for commuting without the disabled person present), the exemption may be invalidated. Similarly, if the disabled person passes away, the exemption typically ends, and the vehicle must be re-taxed or declared SORN within one month.

If you are part of the Motability scheme, check your lease agreement; road tax is usually included, and Motability manages the exemption process for you.