Fleets are being warned there is no grey area when it comes to private mileage use following tax changes for double cab pick-up drivers.
The Association of Fleet Professionals (AFP) says it is essential fleet managers fully understand the rules so they do not fall foul of the changes, which were announced in the Autumn Budget.
From April 2025, for corporation tax, and from April 6, 2025 for income tax, double cab pick-ups (DCPUs) will be treated as cars for the purposes of capital allowances, benefit-in-kind (BIK) tax and some deductions from business profits.
Some fleets have expressed confusion about what constitutes business and private use for pick-ups. This is because there is some flexibility built into HMRC rules for vans that state the vehicle can be used for private purposes, but only to an “insignificant extent”.
HMRC has given a few examples of what “insignificant” means, like taking an old mattress or other rubbish to the tip once or twice a year, stopping at a newsagent on the way to work or stopping at the dentist on the way home.
As double cab pick-ups are now treated for tax purposes as a company car, it means there is no such “insignificant extent” allowance like there is for vans.
Paul Hollick, AFP chair, told Fleet News: “If you make the pick-up available for private use, then BIK is due. It doesn’t even need to travel one mile.
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Freelance writer for Fleet News, Tom Seymour has been a specialist B2B journalist covering the automotive sector for over 14 years. He started his freelance career in 2015 and currently writes for a variety of automotive, business and technology publications.
dhorn5268 - 17/12/2024 11:58
Can we confirm that any double cab pick up vehicle currently on our fleet or purchased prior to April 2025, will follow existing rules for BIK etc. for these vehicles until April 2029.