Industrial cleaner standing with a company van
Company van tax: who has to pay it? And how not to
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Company van tax at a glance

 

  • Company van tax is liable if you use a company van for private use
  • If you are an employer, you will be liable for Class 1A NIC and P11D reporting if  your vans are driven for private use other than ‘incidental’
  • Use our Company Van Tax Calculator to work our your tax
  • Use our Company Van Tax Calculator to work out your fuel benefit tax

COMPANY van tax – do I have to pay it? That’s a common question raised by many trades and delivery drivers.

The answer is “yes” if the van you drive is supplied by your company and you use it for private mileage.

In which case, you will have to pay company van tax.

The annual benefit in kind tax liability for company vans is fixed – unlike cars, where the tax is based on a scale of CO2 emissions.

For 2017/18 tax year the company van tax benefit in kind is £3230; the same amount is fixed for 2019/20.

You then pay the amount you owe depending on whether you pay tax at 20% or 40%. For our easy to use company van tax calculator, see the panel right.

If you drive your van for private use, then usually all your fuel is paid for. So in addition, any private fuel will also be taxable – the yearly tax liability for “free” fuel – or the fuel benefit tax –  is £610 for 2017/18.

You then pay the amount you owe depending on whether you pay tax at 20% or 40%. For our easy to use company van tax calculator, which will show you your free fuel benefit tax liability, see the panel right.

Can company van tax be avoided?

 

Simon Wroe, marketing director at Lease4Less Vans, has this advice: 

“There are some common misconceptions about company van tax with UK businesses as benefit in kind tax rules are so different to cars.

“What many businesses don’t realise is that the HMRC doesn’t count the commute – the drive between home and work – as private mileage, like they do with cars.

“This means that if a company van driver only uses the van for the commute and daily business, and they do not use it for personal use, they don’t actually have to pay van tax at all.

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