IN WHAT will be a significant relief to leasing brokers – not to mention their customers – HMRC has reversed its decision on the treatment of double cab pickup trucks.
Only last week, HMRC said that double cabs over 1 tonne would no longer be classed as commercial vehicles but as cars for both benefit in kind taxation purposes and for capital allowances. The decision followed a 2020 Court of Appeal judgment and was due to start 01 July 2024. See our story Brokers face declining sales of double cabs with new tax rules announced.
However, following pressure from farmers and the motoring industry on the potential impacts of the change in tax-treatment, the government acknowledges that the 2020 court decision and resultant guidance update could have an impact on businesses and individuals in a way that was not consistent with the government’s wider aims to support businesses.
So as of today (19 February 2024), HMRC has today announced that its existing guidance is to be withdrawn. It means that double cabs will continue to be treated as goods vehicles rather than cars, and businesses and individuals can continue to benefit from its historic tax treatment.
The government added that it will be legislating to ensure that double cab pickups would continue to be treated as goods vehicles for tax purposes. Draft legislation will be introduced at the next available Finance Bill.
“We will change the law at the next available Finance Bill in order to avoid tax outcomes that could inadvertently harm farmers, van drivers and the UK’s economy.”
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Ralph Morton is the leading journalist in the leasing broker sector and editor of Broker News, the website which provides information and news for BVRLA-registered leasing brokers. He also writes extensively on the fleet and leasing market in both the UK and Europe.
