Never exactly what you’d call a looker, BMW has finally taken a break from filling every niche imaginable to smarten up its 1-series, so much so that it’s easy to be misled into thinking the hatch is all-new; it isn’t – it’s merely a well-executed facelift of the second-gen 1-series that first went on sale back in 2011.

Sporting new front and rear lamps, redesigned bumpers and a reshaped version of the trademark kidney grille, the refresh also sees a fuel consumption drop of 12% across the range thanks to the introduction of more efficient and powerful engines.

Now there’s the choice of three petrol engines: a 1.6-litre turbo with either 136hp (118i) or 177hp (120i), a 2.0-litre turbo with 218hp (125i), and the range-topping 326hp M135i that’s powered by a 3.0-litre turbo. On the diesel side there are just two engines: the 109hp 1.5-litre lifted from the Mini (badged 116d) and a 2.0-litre that comes with 150hp (118d), 190hp (120d) or 224hp (125d).

Most tempting is the 190hp 120d that, even on the largest wheels and loaded with kit, can reach 62mph in just 7.1 seconds, top out at 142mph and average 62.8mpg.

More cost-conscious business buyers, meanwhile, will be won over by the new 116d ED that can average 83.1mpg and emit just 89g/km of CO2.

Just four trims are now offered with the 1-series: Urban, SE, Sport and M-Sport. For 2015, all models now come with climate control, a 6.5-inch infotainment screen controlled by the familiar iDrive dial, and parking assist that can now park perpendicularly. Bucking the new trend, BMW hasn’t fitted collision warning, attentions assist and lane departure warning as standard.

Inside, cabin quality has been boosted by higher-grade materials, and, like before, it’s easy to find a comfortable driving position behind the wheel.

We drove the 120d with optional xDrive all-wheel drive. Costing a significant £3050 more than the standard car, it’s a pricey option, but one that 20-25% of all UK buyers (including fleets) opt for, despite a fuel consumption penalty of 10% over the 2WD variant.

The revised 2.0-litre engine is as willing as ever and offers plenty of performance, but remains vocal when worked. Off the motorway and on slower roads, the small BMW is in its element – agile, engaging and surprisingly quick cross country with the added security of four-wheel drive. It’s close to the class best for its drive, although it’s a shame the steering, which lacks accuracy, isn’t as good as a Mercedes A-class.

BMW 120d M-Sport

Model price range                        £20,775-31,725
Residual value                                        37.9%%
Depreciat­ion                                             £16,725
Fuel                                                             £4939
Service, maintenance and repair                £2474
Vehicle Excise Duty                                          £60
National Insurance                                       £2231
Cost per mile                                                  56.1p
Fuel consumption                                      62.8mpg
CO2 (BIK band)                               118g/km (19%)
BIK 20/40% per month                              £85/£171
Warranty                                   3yrs/unlimited miles
Boot space (min/max)                       360/1200 litres
Engine size/power                              1995cc/190hp