THE double-cab pickup market is about to get a mauling by HM Revenue and Customs as dual-purpose vehicles will be considered cars for company benefit taxation starting 1 July 2024, reports the Professional Pick-up web site.
Previously, these vehicles were categorised as either cars or vans based on their payload — any double-cab that could carry more than a tonne was considered a commercial vehicle, and Benefit in Kind taxation was then set against a fixed rate of £3,960. A 20% taxpayer with a double-cab pickup as a company vehicle would face a monthly tax bill of £66, while those paying at the 40% rate would be spending £132 a month.
But from July, double-cab pick-ups will be considered cars as they don’t have a primarily commercial function. Professional Pick-up said the changes will be significant – a driver using a Ford Ranger Wildtrak 2.0 as a company vehicle will, if taking delivery after 1 July 2024, face a company car tax bill of around £290 a month, rising to around £580 a month for a higher rate taxpayer — an increase of 340% over the existing figures.
The change follows a legal case between Coca-Cola and HMRC, which concluded that a vehicle should be clearly suited to one task or another and that no decision should be based on a narrow margin. In cases where it’s not clear if a vehicle is primarily suited for carrying goods or people, it should be classified as a car.
From 1 July 2024, double-cab pickups will be assessed in their entirety to determine their primary use. Most double-cab pickups are now likely to be classified as cars for tax purposes, as they are typically designed to transport both passengers and goods without a clear primary use.
For employers who bought, leased, or ordered a double-cab pickup before 1 July 2024, HMRC has confirmed that transitional rules will see the current classification remain in place until the vehicle is sold, the lease ends, or until 5 April 2028 at the latest.
