Audi’s RS division has long been a byword for supercar performance allied with everyday usability. The second-generation Audi RS3 Sportback doesn’t stray from those tracks, harvesting the most powerful five-cylinder engine in RS production history alongside a big boot and space for five adults.

The headline improvements are reduced weight, more power and a lot more drama than before. All three of those advancements are a result of an uprated version of the 2.5-litre five-cylinder turbocharged engine as well as new MQB underpinnings. A total of 55kg of weight has been shed and 27bhp gained, boosting total power to 362bhp. That’s 7bhp more than you’ll find in the Audi’s closest rival; the Mercedes A45 AMG.

But the developments don’t stop there. The new platform has also allowed Audi to fit re-engineered springs and dampers as well as stiffer struts to the RS3, which make the car’s feverish appetite for speed easier to contain.

So, what does this all mean for performance? Well, 0-62mph takes 4.3 seconds – three tenths quicker than before – and it gets a top speed of 174mph. That makes the RS3 just as quick from a standing start as the old Lamborghini Gallardo, but with half the number of cylinders, twice as many doors and a big boot.

We drove the car in Ivalo, northern Finland with temperatures as low as -27 degrees celsius, and we’re the first to admit this is far from a real-world test. But, if the mega-hatch can manage these hostile conditions a rainy UK B-road should be dispatched with minimal effort.

Pressing the starter button brings the 2.5-litre five-cylinder barking into life, and a new active exhaust – fitted as standard – emphasizes the unmistakable offbeat warble. Given the conditions, winter tyres were fitted to our test car, but even so we scrabble away from a standstill sending up huge rooster tails of snow behind us. Power delivery remains explosive with all 465Nm of torque available from as little as 1,650rpm.

A tight and twisty handling circuit highlighted the far more playful character of the second-gen RS3 over the previous model. Its predecessor was often criticized for being rather inert with a tendency to understeer prematurely. Given the low-grip conditions it’s impossible to say whether understeer has been eradicated completely, but there’s definitely a new level of interactivity that was sorely missed from its predecessor.

It’s testament to the wonders of the MQB platform, something that has also recently transformed the Audi TT into a proper driver’s car. Hints of that enhanced agility can be felt in the RS3 too, especially when you toggle through the various driving modes – auto, comfort and dynamic – which loosen the reins on the traction control and allow great freedom.

A more responsive quattro all-wheel drive system and new Haldex 5 clutch also transfers power to the wheels faster than before, with between 50 and 100 per cent of the car’s power able to be transmitted to the front or rear wheels depending on which axle demands the most traction. It allows you to turn in more precisely and hold the car in what seem to be never-ending four-wheel drifts.

Visually, a gloss-black honeycomb grille, gaping air intakes with an F1-style front blade as well as beefed up exhaust pipes and arches give the attitude the RS badge warrants. But despite the aggressive exterior, beneath the surface this mega hatch is still a practical and spacious A3 at heart, with a 340-litre boot.

Carbon-ceramic front brakes have been made an option for the first time, with a louder sports exhaust and RS bucket seats also on the options list. Official pricing has yet to be announced, but a sub-£40,000 price tag is expected and you’ll struggle to find this much performance, practicality and excitement for less.

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