Isuzu D Max on building site
Utility cabs such as this Isuzu D-Max or luxurious double cabs are all subject to the same company van tax for pick-up trucks. But only if you drive the pick-up on private mileage
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Additional reporting by Ralph Morton

WE all like a beefy pick-up truck. And there are plenty of those around now. But whether you drive a utility pick-up as essential work tool or a more luxurious double-cab pick-up are you required to pay van tax?

Answer: yes if you have a company provided double or single cab pick-up and use it for private mileage.

But the silver lining to this is that you don’t have to pay company car levels of benefit in kind taxation.

Currently, HMRC classifies these pick-ups as vans – as long as they have a payload of 1 tonne (1000kg) or more. A payload means the vehicle’s gross vehicle weight less its unoccupied kerb weight.

Where a pick-up has a hard top, this is given a generic weight of 45kg. So a pick-up that has a payload of 1010kg will convert to a car under these definitions. So it’s important to ensure your pick up qualifies as a commercial vehicle.

And to use the correct term, company van tax is referred to as the Van Benefit Charge by HMRC.

So how much is company van tax for a pick-up?

The Van Benefit Charge has risen to £3350 for the 2018/19 tax year. Which means:

  • The van tax on double cab pick-ups and single-cab pick ups is £670 for a 20% tax payer
  • The van tax on double cab pick-ups and single-cab pick ups is £1340 for a 40% tax payer

If you also get paid for all your fuel – private and business – then there is the fuel benefit charge to pay.

The Van Benefit Charge including free fuel is £633 for the 2018/19 tax year. Which means:

  • The van tax on double cab pick-ups and single-cab pick ups including free fuel is £797 for a 20% tax payer
  • The van tax on double cab pick-ups and single-cab pick ups including free fuel is £1593 for a 40% tax payer
VW Amarok
VW Amarok – whether you drive a luxury version or a utility version – has the same Van Benefit Charge if it is a company vehicle and you use it for personal use other than commuting to work

Do I have to pay company van tax on my pick-up?

Not always. If you cover no private mileage, there is no tax to pay (ie all mileage is for business purposes).

And, you should know, that the taxman does not count driving the pick-up between home and work as private mileage or diverting to pick up a newspaper or cup of coffee on the way to work. But regular trips to the supermarket or taking the pick-up on holiday would constitute private mileage.

In reality, the luxury end double cab pick-ups are more likely to be used for private mileage.

If you are a sole trader or a partner, there is no tax on single-cab and double-cab pick-ups.

 

3 COMMENTS

  1. Does this advice only apply to pick ups or does it cover crew cab vans as well ?

    eg would a Ford Transit DCIV (crew cab) 310 1106kg payload be classed as a commercial vehicle and subject to the flat rate ?

    Yes it would – the tax covers vans and pick ups. However, HMRC is taking a stronger stance on some of the new crew cabs and suggesting that as they are more car like in their carrying ability and comfort, they should be classed as cars. Our opinion is that – if it looks like a van, it is a van. Check with your accountant first before taking any further action.
    Ralph Morton, editorial director

  2. I currently have a Renault Trafic crew cab; I swapped my car for one. Its payload is 989kg – my boss is now saying as far as HMRC this would be a car is this correct?

    I’m afraid your boss is probably correct. The area of crew cabs is a little grey, but essentially if it is under 1 tonne and being used as a private vehicle then it is considered as a car. If your Trafic crew cab is a works vehicle and being used exclusively for business (ie private use is incidental) then it will be classed as a van. Ralph Morton – editor

  3. “And, you should know, that the taxman does not count driving the pick-up between home and work as private mileage…”

    INCORRECT!
    See https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim32170

    “Travel between an employee’s home and a permanent workplace is “ordinary commuting” and the expenses of such journeys do not qualify for relief under Section 338 ITEPA 2003, see EIM32150 onwards. That rule applies even when the employee does some of their work at home, and even if you accept that they are entitled to relief under Section 336 for the additional expenses of working at home, see EIM32760.”

    You are correct in terms of cars; however, for vans and pick-ups, HMRC takes the approach that we have outlined in the article. Simply because it recognises that these are working tools – often requiring early starts – and that there is no personal benefit from doing this.
    Ralph Morton, Editor

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