HMRC’s Screeching U-turn on Double-Cab Vans

Only a week after HMRC released new guidance that classed double-cab pickups as cars rather than vans, the government has now performed a screeching U-turn and has reversed this decision. 

HMRC had recently revised its interpretation of how double-cab vans would be treated for income tax purposes (12th February 2024), following the Court of Appeal decision in the case of Payne & Ors (Coca-Cola) vs R & C Commrs (2020).

Originally, changes effective from 1st July 2024, on the hotly debated topic of double-cab pickups, had seen HMRC update its guidance in the employment income manual. Effectively meaning that double-cab pickups would have received less preferential treatment for benefit in kind (BIK) purposes.

Following discussions with many large agricultural companies and the motoring industry, who were concerned about the impact of this guidance on their businesses, HMRC has made a massive U-turn.

The government is set to legislate to keep things exactly as they were. So double-cab pickups will continue to be treated as goods vehicles for tax purposes and the tax on benefits-in-kind will not increase when employers provide these vehicles to their employees.

It’s also worth noting that the capital allowances available in the first year of use will now not be reduced when a business purchases this kind of vehicle for use in their trade.

Buckle up! Navigating tax on vehicles and benefit in kind can be very complicated – and we’re here to help. Please call our team of experts for advice on how you should be treating your company vehicle, whatever its size!

Moorgate Chartered Accountants

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