Category


Archive

When is a company van not a van?

Monday, October 23 2017

The P11d benefit charges on company vans are generally much lower than company cars and where private use of the van is merely incidental to its business use by the employee, then there is no taxable benefit at all. But when is a van not a van?

In a recent tax tribunal case, the judge agreed that a VW Kombi van that had been converted so that it had two rows of seats for passengers was a company car not a van.

Under the employee benefit rules, a van is a vehicle where its primary construction is for the conveyance of goods or burden.  Kombi vans and those similar have not previously been thought to fall into this category due to them being designed to carry both goods and people. Historically, HMRC has offered a concession from 2002/2003 for double cab pickups (including both uncovered and covered models), if the payload capacity of the pickup exceeds a metric tonne. HMRC accepts that these vehicles can be treated as a van for benefit in kind purposes.  The judge decided that the primary construction of the kombi van was not for the conveyance of goods alone but rather that its purpose was for the conveyance of both goods and people equally. This means that the Kombi did not meet the requirement to be considered to be a van and therefore for benefit in kind purposes it was a car. To sow further confusion however, the same judge decided that Vauxhall Vivaro vans converted to have two rows of seats were vans!

Similar rules apply for VAT purposes so contact us first if you want to check the correct tax treatment of the vehicle you are planning to buy.

Latest Posts

Contact Us

If you have any questions, please do not hesitate to get in touch

About Us

Ryecroft Glenton, founded 1901, is an independent, award-winning firm of Chartered Accountants and strategic business advisers giving personalised support to every one of our clients.

Sign up to our Newsletter

Subscribe to our email newsletter for useful tips and valuable resources sent out every month.

Contact Info

Address: 32 Portland Terrace Newcastle upon Tyne. NE2 1QP

Telephone: 0191 281 1292

Fax: 0191 212 0075

Email: email@ryecroft-glenton.co.uk