Best electric cars under £40,000: Top EVs to avoid new UK car tax
After tax changes added hundreds of pounds a year to EV running costs, we count down the 10 best new electric cars to avoid the Expensive Car Supplement
April 2025 brought major tax changes for anyone buying a new EV. As well as making zero-emissions vehicles liable for the annual £195 car tax, the changes mean that any EV costing more than £40,000 is subject to the Expensive Car Supplement – adding another £425 per year for ownership years two to six.
With the average EV costing more than £40,000 that means a lot of attractive models suddenly carry a hefty additional cost. But fear not, because there are still plenty of brilliant electric cars for less than £40,000 and we’ve rounded up 10 of our favourites, from superminis to family SUVs.
Skoda Elroq
The Skoda Elroq is one of the best compact EVs on sale and part of its appeal is incredibly competitive pricing. Entry-level cars start at £31,510 and only the range-topping Sportline 85 and performance-focused vRS break the £40,000 barrier. As with so many Skodas, the Elroq offers more space and equipment than most similarly priced rivals as well as an impressively refined ride. Below £40,000, it also offers a choice of powertrains providing between 168bhp and 282bhp, and between 232 and 355 miles of range.
Kia EV3
The Kia EV3 shares virtually all the qualities of the Skoda Elroq. Like the Skoda, the EV3 offers impressive space and equipment levels, plus performance and range that puts it right at the top of its class. Only the top-spec GT-Line S trim breaks the £40k barrier, and the £39,405 GT-Line brings an 81kWh battery, 367-mile range and all the equipment you’d need, except a heat pump. Even the entry-level Air has plenty of kit and can be specified with the big battery or a smaller pack that means you can pick one up for £33,000.
Renault 5
The Renault 5 isn’t just one of the best EVs under £40,000, it’s actually one of the cheapest electric cars on sale. Starting at just under £23,000 it’s a brilliantly stylish reinvention of Renault’s iconic supermini. It’s a compact hatch, so rear space is tight, but five doors make it more practical than a Mini or Fiat 500. More importantly, though, it brings the latest big-car technology to the segment along with up to 250 miles of range and peppy performance. And did we mention how cool it looks?
Vauxhall Grandland
The Grandland perhaps isn’t the best car in its class but Vauxhall has been very smart with its pricing. It recently slashed the list price of its largest family SUV to bring every model below the ECS threshold and mean top-spec versions cost less than the entry level versions of rivals like the Ford Explorer. That means you can have a fully loaded Ultimate with adaptive LED headlights, panoramic sunroof and a powered tailgate for £39,095, or an entry-level design for £36,455. While the Grandland’s looks and drive are nothing to write home about, it’s a thoroughly capable and likeable EV with decent range and performance. And priced as it is, it represents impressive value.
Citroen E-C3
Like the Renault 5, the Citroen E-C3 is a cheap and cheerful compact hatchback that won’t suit everyone but that ticks all the boxes for a large number of people. A deliberately simple car, it concentrates on doing the basics well. It can’t compete with the range or tech of some cars on this list but, priced from £22,000, it doesn’t need to. What it does do is offer a quirky small EV with 200 miles of range and the best ride in its class, along with the day-to-day tech most people actually need.
Abarth 600e
A silly choice, but cars don’t have to all be sensible and worthy. So if you fancy hot hatch hilarity in a compact SUV shape, then the Abarth 600e is the car for you. Fiat’s tuning arm has taken the worthy but dull Fiat 600e and turned it into a genuinely fun and engaging EV with 276bhp, a limited slip diff, fake engine noise and a keen and dynamic chassis. It’s not a car for shrinking violets but for theatrics and driving enjoyment there aren’t many sub-£40k EVs that can compete with the Abarth.
Tesla Model 3
The politics of the man in charge cloud any discussion of Tesla and for some buyers are enough to stop them even considering one of its cars. However, viewed purely from a product perspective, the Model 3 has to be on this list. Just scraping in at £39,990 is the standard-range, rear-wheel-drive version of the compact saloon. Even this basic model offers a 323-mile range, ultra-fast charging, and smart connected services, which make it a good fit for a lot of EV buyers.
Renault Scenic
Renault is on impressive form with its EV range at the moment. Alongside the stylish but small Renault 5, the Scenic offers a spacious, practical family SUV that won’t break the bank. As of the start of May, the Techno and Esprit Alpine both come in under the £40,000 threshold and both get the “long-range” powertrain. That means 217bhp and an 87kWh battery good for up to 380 miles, plus a strong equipment list that includes a powered tailgate, heated steering wheel and heat pump as standard.
Kia EV6
Kia’s EV6 has always been a fantastic all-rounder but it’s also always floated just beyond the £40,000 mark. However, Kia recently announced a new entry-level model that brings this multi award-winning family crossover beneath the ECS threshold. For £39,235 you can bag an EV6 Air standard range – £5,000 less than the next cheapest model. The cost saving comes via a smaller battery and less powerful motor. In place of the 84kWh/225bhp setup of previous models, the ‘standard range’ car uses a 63kWh pack and 167bhp motor. That means a drop in range from 361 miles to 265 miles and needing an extra second to reach 62mph. However, both figures are perfectly respectable and even the standard range’s slower charging speed is still faster than most rivals at 195kW. Elsewhere you get the same spacious, comfortable and refined large family car with the same solid equipment levels as the bigger-batteried Air models. Read the full review
VW ID.3
While much of the EV world is obsessed with SUVs, Volkswagen’s electric equivalent to the Golf has shown there’s still space for a regular family hatchback. In fact, for many people it’s the sensible choice, offering plenty of room and a pleasant driving experience. Pricing and specification for the ID.3 have varied over recent years but, currently, there are six options to choose from, all between £30,000 and £40,000. Three battery sizes offer between 242 and 346 miles of range, with the larger batteries reserved for the better-equipped and more expensive Pro S grade.
