By Glynn Williams
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 an 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 than 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
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.
What HMRC has to say: