Not sure if we’ve done this but HMG is tightening up the rules on pickups as company cars - essentially if it’s a double cab, it’s a car with the tax implications that go with that.
Personally I think this is a Good Thing (given size, danger to vulnerable road users and CO2), but I’m sure others will disagree. In any case, it’s out there as of yesterday.
Guidance here
I'm guessing all those that don't use one will think it's a good thing and those that do will think it's a bad thing.
As usual it's a broadbrush tax grab that penalises self employed tradies.
Some guy in middle management using one as a company car as a tax dodge, fine - he should pay BIK on it, but a tradesman who genuinely uses one for work shouldn't be penalised IMO.
There's only one way this topic is going on here though
Totally agree Artist, Its going to piss off lots of the people who work for the Utilities Companies isn't it.
Pickup topped up with tools and kit, no use as a car but taxed like one..
Crew cab vans will be next, I guess all the van fanboys will be upset about that.
Wonder what they will class a Disco Commercial as - currently, it's a van? Won't affect my old knacker of a '16 plate D4, but (having had one fairly recently and may buy another), will they apply the rule to a new Disco 5 Commercial? They only have 2 seats though.
Also, is this one step towards stopping you claiming 100% VAT back on DC pick-up's too? And 100% AIA (annual investment allowance against Corporation Tax)?
Pickup topped up with tools and kit, no use as a car but taxed like one..
in those circumstances I'd be annoyed at being taxed on it in the first place - it should be treated as a pool vehicle if I'm getting "no use as a car" out of it.
I suspect the only legitimate users it'll target are farmers, does anyone sell crew-cab or single-cab pickups in the uk any more?
edit : looking at autotrader it seems like the ranger, d-max and hilux are all available with 2 doors, so they'd all count.
I suspect the only legitimate users it’ll target are farmers
I ain't no farmer
And yes, it is stuck
@Artist At least it wasn't snapped in half..?
I know a fair few people with Defender Commercials some with seats in the back and some without..
The V8 SWB van is lovely.
Pickup topped up with tools and kit, no use as a car but taxed like one..
Not a crew cab, no problem.
I ain’t no farmer
is that classed as a company car at 11 years old? there's surely more BIK paid after a decade in service than its list price was?
Pickup topped up with tools and kit, no use as a car but taxed like one..
Depends, you only pay BIK if there's a benefit, i.e. if you use it as a car.
I've yet to see an SSE Hilux parked up at Swinley with a Dakine tailgate protector. But you do see a lot of Ford Rangers which have clearly never seen a days work in their pampered life.
Crew cab vans will be next, I guess all the van fanboys will be upset about that.
There was something I saw in passing about HMRC winning a court case against Coca Cola arguing that combis were in fact cars, which when some of them are cars on the V5C surely is hard to argue against?
HMRC winning a court case against Coca Cola
This finely balanced test is at odds with the judgement reached by the Court of Appeal in Payne & Ors (Coca-Cola) v R & C Commrs (2020) BTC19 (see EIM23121). This confirmed that when applying the primary suitability test at Section 115 ITEPA 2003, decisions shouldn’t be reached on a narrow margin. Furthermore it clarified that where there are finely balanced cases, where no predominant suitability for the carriage of goods can be identified, the default should be that they are cars.
Transitional arrangements will apply for employers that have purchased, leased, or ordered a double cab pickup before 1 July 2024, whereby they will be able to rely upon the previous treatment until the earlier of disposal, lease expiry, or 5 April 2028
So it looks like if the vehicle can be used equally well to transport people and stuff then the default is treat it like a car for tax purposes, but if you've already got one you be OK tax-wise for the next four years.
Seems like a sensible decision.
Seems like a sensible decision.
Ignoring the 4 years grace if you already own one (now watch prices rocket until July). A tradesman who uses it primarily for work (possibly including transporting employees) will now be stung for (completely and utterly stabbing in the dark) an extra £200-300-400/month in tax for a vehicle that his company pays for in the first place to do a job? It's not a perk, it's a work vehicle that 'can' be used for SDP, much in the way that a van with a couple of extra seats can - and as such, you pay a cetrtain amount of tax. Just not as much as if it's a car provided for sole use as a car.
There needs to be some sensible definition as to it's use and not just - oh that vehicle is now a perk, we're stinging you. It's not sensible at all
On the other hand, I suspect this is a case of people taking the piss inconveniencing people who aren’t, and as above single cabs aren’t affected (which can still seat 3?)
it’s a work vehicle that ‘can’ be used for SDP
So don't use it for sdp and you won't have to pay bik.
So don’t use it for sdp and you won’t have to pay bik.
This really shouldn't be a hard concept.
A tradesman using his 'van' to get around in outside work hours not being the same as a middle manager using a pick up as a tax dodge shouldn't really be a hard concept to grasp either.
You already do pay BIK for SDP use of a van, just not the same amount as having a mid range/luxury car to swan around in. For now. Putting them in the same bracket isn't a fair penalty for a percentage of pick-up drivers. If you can't see that, then you are just being awkward for the sake of it
So you don't use it for sdp if you don't want to pay the bik.
Hopefully they’ll use the extra tax taken to pay for some good causes
Good cause round here.......mend the potholes !
I think the plan is to deter people from buying them rather than to rake in the tax.
But the higher the GVW the more potholes, so…
Meh, tightening up on commercial vehicle taxation is small beans compared to some of what goes on.
I’ve yet to see an SSE Hilux parked up at Swinley with a Dakine tailgate protector. But you do see a lot of Ford Rangers which have clearly never seen a days work in their pampered life
Are you sure they’re not privately owned? I know of a few people that own 4 seater pickups and one will be parked at Swinley from time to time. Wouldn’t be my choice, but hey.
Out of interest does anyone know the difference in BIK tax in a Tesla type thing and a pickup?
So you don’t use it for sdp if you don’t want to pay the bik
Are your powers of discussion limited to simply repeating yourself?
We are (or maybe it's just me) trying to discuss a NEW rule (not avoidance of an existing one) and how it's application could be implemented differently
But yeah, it doesn't affect you, so anyone it does affect has to suck it up
I think the plan is to deter people from buying them rather than to rake in the tax.
I tend to err on the side of them wanting to rake in the tax tbf
An electric car will almost always be less, but a pickup will be less than nearly any non electric car.
Electric pickup would be almost free, and potentially power tools on site
An electric car will almost always be less, but a pickup will be less than nearly any non electric car.
As I suspected, so if I want to have private use of my diesel company vehicle , which I have no choice of vehicle due to my job, I have to pay more than management with their flashy Tesla.
They probably get cheap E Bikes through tax breaks they never ride to work too.
To be clear, we don’t have management with Tesla’s and e-bikes, or management really, but that’s not the point.
If employees have to pay car rates for a pickup can see my employer will be faced with either having to buy more expensive 4x4's to appease staff paying the extra value of a car, whilst trashing the interior, or, buying vans that will be spend more time being maintained and more time being recovered more often. Or a bigger yard for everyones personal car and commercial pickups.
I get that they want to close the loophole, I'm not that great a fan of the things as there are many things they don't excel at, but they are the best compromise in my line of work.
Double cabs fall into the middle ground between cars and commercial vehicles such as pickups/trucks.
I understand the argument from tradies (possibly) using them for work but HMRC are removing any ambiguity by sweeping them into BIK.
In the context of the overall tax take it's less than small change but easy pickings.
There might be more sympathy - or less criticism - if HMRC were seen to be (aggressively) pursuing large scale tax dodgers and multinational tech companies registered in low tax domiciles.
Good cause round here…….mend the potholes !
Caused by all them tax dodging massive pickups 😂
A tradesman using his ‘van’ to get around in outside work hours not being the same as a middle manager using a pick up as a tax dodge shouldn’t really be a hard concept to grasp either.
If you use a work vehicle for non-work, it's a benefit because you then don't need your own car. So you get taxed on it. Really simple.
Teslas are zero or low BIK as an incentive to reduce transport emissions. Again pretty simple, governments use tax to incentivise people all the time.
I predict a sudden spike in crew cab van sales.
https://www.ford.co.uk/vans-and-pickups/transit-custom/trail
If you use a work vehicle for non-work, it’s a benefit because you then don’t need your own car. So you get taxed on it. Really simple.
Nothing new there, you don't have to be patronising. I already pay BIK tax on my work van that I use for personal duties. Always have done. Being a shitty work van that's also (mostly) used for construction work, that rate is (for now) lower than a posh company car and rightly so imo
Does this mean the price of 2nd hand double cab trucks is going to drop? Do hope so, could really do with replacing ours.
No they'll go up as new supply into the market will be decimated.
This is a tax on all of us. Most are bought by the trades & self employed, and while I'd agree many if those are unnecessary for the job in hand and so just a cheap vehicle, it means that their cost base will go up, and therefore so will everyone else's. Tax loopholes like this don't benefit rich corporations they benefit everyday individuals just making a regular living, and so closing them just makes everyone's everyday a bit harder while the big corporations continue to funnel tax through cheap offshore offices and every other wheeze available.
To incentivise people who probably don’t actually need a company vehicle.
Yes, it would have been better to take the money and put it into some other EV grant scheme available to everyone, but I do think that the incentive has resulted in far more EVs on the road which means there is now a far better used supply; this has also created huge growth in EV charging infrastructure.
To incentivise people who probably don’t actually need a company vehicle.
Which is probably fair. BIK rules also sweep up people who e.g. use the NHS lease scheme which isn’t really a company vehicle.
Maybe they'll be a take up in double cabs being sold officially without rear seats, and retro fitted afterwards, Like you can with the Suzuki Jimny. Personally I prefer vans but can see why people have them as they're nicer things to run about in, usually more torque for towing and better off road.
so if I want to have private use of my diesel company vehicle , which I have no choice of vehicle due to my job, I have to pay more than management with their flashy Tesla.
The scheme applies to everyone, and all vehicles, so if you have a choice of a diesel golf or an id3, the latter will cost you less even if the list price is higher. It's nothing to do with management
I already pay BIK tax on my work van that I use for personal duties. Always have done. Being a shitty work van that’s also (mostly) used for construction work, that rate is (for now) lower than a posh company car and rightly so
That continues to be the case for an extended cab pickups, which can also continue to be used for commuting to/from work.
AINAE but are double cabs with 500kg payload a bit of a UK thing than sprang up in response to the tax saving ? They seem to be pretty flashy rather than utilitarian.
However, these 400bhp PHEV vehicles (see also Range Rover P400e) aren’t really that are they? They are usually a 300(ish) 2l with an electric boost (for as long as it lasts – probably not that long), or it get’s used up trundling about locally purely on the motors. That said a 2l in a Volvo estate is going to fare better than in a big Range Rover
But – I am going to research and see if real world usage of these proves me wrong and it might well be on the list – especially if the emissions will make it beneficial to buy through the Ltd company (usually not)
biscuits anyone?
The tax rules were tightened up a bit to catch out PHEVs in name only. EV range is now part of the calculation
Interestingly I think the legislation affects vans too
If a vehicle has side windows behind the driver and passenger doors, it is also unlikely to fall within this exception. This is particularly so if it is fitted, or is capable of being fitted, with additional seating behind the row which includes the driver. This remains true whether or not those additional seats are in the vehicle at the time.
Nearly all crew cab vans have an extra set of windows so will be counted as cars
better off road
The furthest off road most have these have gone is to park on the pavement.
As @jonnyboi has said flash DC pickups seem to be a UK thing driven by tax.
WRT combis, I suspect it’ll be a case of it’s a van with van speed limits and tax, or it’s a car with car speed limits and tax. As above I gather HMRC successfully challenged Coca Cola on this.
Wonder what they will class a Disco Commercial as – currently, it’s a van? Won’t affect my old knacker of a ’16 plate D4, but (having had one fairly recently and may buy another), will they apply the rule to a new Disco 5 Commercial? They only have 2 seats though.
No seats in the back, it's a van and taxed as one.
The number that I see being driven poorly on my commuting days I reckon it's a good thing that the perk ones will be removed from the roads over time.
All the self-employed trades I've ever used have arrived in Vivarros, T5s and connect type vans. Not one has a crew-cab as they are not fit for trade use, too low a payload, insecure rear deck area and no privacy for tool storage.
