Commercial vehicle windows

dilby

Hi everyone - my accountant is currently away for a little over 2 weeks and am in a hurry to source a new vehicle which I’m finding confusing and was hoping some kind folks could help.

I am a videographer who travels around filming for clients, and need a van to fit my gear. However I regularly travel with a crew and need two rows of seats. There are several of these locally I’ve found that fit the bill but they all have windows next to the second row of seats, and from what I can read that means I can’t claim it as a business vehicle. Of course to me this seems odd, as having a growing business with bigger jobs is the very reason I need more seats, and I don’t really like the idea of putting people in the back without windows, makes me feel like a people smuggler or drug runner and I’m surpised it’s encouraged!

To confuse me more, it seems all my competitors have vans with windows in the back and they are clearly signwritten for the business; so is the assumption that they aren’t claiming for these or that it’s one of those grey area laws that there is more ifs and buts for me to consider? Or is it simply as black and white as I’ve stated?

And then to make matters even murkier, I’ve read that a double cab pickup truck is fine if it has windows in the back (not sure why a different shape changes everything) but is it correct that that’s my only way to have people in the back who can see outside? (Outside of having an electric vehicle, which from what i can understand isn’t very practical for larger loads at the moment.)

(I have a VAT registered limited company)

Thanks!

Dazed_and_C0nfused

Do you really mean "can't claim" or do you mean it would be a different claim?

NB.  I'm assuming you don't really mean "I" but meant the limited company?

Is this vehicle going to be available to you, the company director, to you personally?

DullGreyGuy

What do you mean "claiming it back"?

Normally the company would be the one buying/leasing the vehicle. Assuming the vehicle is for you then it will almost certainly be assumed that you have access to it as a personal vehicle in addition to its business use. This means that for your personal tax considerations you have a Benefit In Kind and must pay tax on it.

Traditionally Cars and "Vans/pickups" were taxed in a very different way with the later attracting a lot less BIK than the former. The regulations however are changing such that any new vehicles after X date that have a second row of seats will be considered a car for the purposes of calculating the BIK. Hadn't heard about the second row having to have windows for it to apply but it may be a factor. 

So yes it can still be a business vehicle just you will pay a higher level of personal tax on the BIK. Your competitors who already use such a vehicle will have bought it before the rules changes and so will continue to pay BIK on it as if it were a van for the couple of years of grace. In a few years when the grace period has ended the market will be flooded with companies offloading such vehicles rather than pay the higher BIK. 

Electric vehicles are great as at the moment the BIK is tiny compared to a petrol/diesel car but doesn't help if there isn't a suitable vehicle for your needs.

jimmo

DullGreyGuy said:

. The regulations however are changing such that any new vehicles after X date that have a second row of seats will be considered a car for the purposes of calculating the BIK. Hadn't heard about the second row having to have windows for it to apply but it may be a factor. 

There was a U-turn on that in February.
Update on HMRC Double Cab Pick Up Guidance - GOV.UK (www.gov.uk)

DullGreyGuy

jimmo said:

DullGreyGuy said:

. The regulations however are changing such that any new vehicles after X date that have a second row of seats will be considered a car for the purposes of calculating the BIK. Hadn't heard about the second row having to have windows for it to apply but it may be a factor. 

There was a U-turn on that in February.
Update on HMRC Double Cab Pick Up Guidance - GOV.UK (www.gov.uk)

until the next u turn anyway

Jeremy535897

This is a complex area. It starts with the definition of a car, and is quite well explained here:
https://www.pkfsmithcooper.com/news-insights/car-or-van-what-is-a-van-for-tax-purposes/

I would add that, in my opinion, a vehicle manufactured to have only two seats, with a big area for loading goods at the rear, and described as a light commercial vehicle for road tax purposes, is unlikely to be a car just because there might be windows behind the driver.

chipolatta

jimmo said:

DullGreyGuy said:

. The regulations however are changing such that any new vehicles after X date that have a second row of seats will be considered a car for the purposes of calculating the BIK. Hadn't heard about the second row having to have windows for it to apply but it may be a factor. 

There was a U-turn on that in February.
Update on HMRC Double Cab Pick Up Guidance - GOV.UK (www.gov.uk)

As long as the payload capability is over 1 ton, under 1 ton, and it will be classified as a car unfortunately.  I think Dilby is meaning the cost of the vehicle being knocked off the company profits to reduce corporation tax payments as a capital asset.  Simple if its classified as a van/plant. But what if its a car, or combo van?

dilby

Jeremy535897 said:

This is a complex area. It starts with the definition of a car, and is quite well explained here:
https://www.pkfsmithcooper.com/news-insights/car-or-van-what-is-a-van-for-tax-purposes/

I would add that, in my opinion, a vehicle manufactured to have only two seats, with a big area for loading goods at the rear, and described as a light commercial vehicle for road tax purposes, is unlikely to be a car just because there might be windows behind the driver.

Thanks I feel the same but the coca cola court case seems to differ 

https://www.fleetnews.co.uk/news/company-car-tax-and-legislation/2020/08/06/coca-cola-loses-company-car-tax-ruling

Jeremy535897

The Kombi has two rows of seats.