Reduce your road tax

  • Changes in April 2009 mean majority of drivers must pay more
  • Only the greenest drivers will benefit
  • High-emission cars will be hit hard

The only sure fire way to reduce the cost of road tax is to drive a car that produces fewer carbon dioxide emissions. Only cars with 100g/km or less CO2 emissions qualify for free road tax.

At the moment, drivers of cars with emissions between 101- and 120g/km can buy six months road tax for free but pay £35 for 12 months.

This loophole closes in 2009 when the new road tax bands come into force.

Opting for a diesel-engined car can reduce road tax costs as most diesels have lower CO2 emissions than their petrol equivalents, though you must remember diesels attract a 3% extra levy for company car drivers.

Most automatic gearboxes push up CO2 output, so pick the same car with a manual gearbox to reduce emissions and save on road tax.