Double-cab pick-ups – End of an era?

I am surprised that it’s taken HMRC some twenty years to get here but (following an HMRC update on the 12 February) they got there in the end.

What am I referring to? Well, the end of the double-cab pick-up ‘van’ treatment for ‘Benefit in Kind’ (BIK) purposes from 1st July 2024 onwards.

If you already have a double-cab pick-up or acquired one before 1 July 2024 then the existing (or soon to be ‘old’) rules will apply until 5 April 2028. However, all pick-ups ordered, leased or purchased from 1 July 2024 will fall under the ‘new’ rules. (EIM23151).

What are the new rules?

There is no simple way to describe them as this is HMRC we are referring to, however, each vehicle will need to be assessed to determine whether the vehicle construction has a primary suitability as per the two-part test outlined at EIM23115

What does this mean?

In plain English, most, if not all, double-cab pick-ups will be classified as cars (from 1 July 2024) when calculating the annual BIK charge.

To put this into perspective, please see the table below to demonstrate the increase in tax faced by employees who drive company double-cab pick-ups:

 Diesel Van List PriceCO2CO2 rateBIK Value20% Tax Per Year40% Tax Per Year
Old Rules to 30 June 2024£45,000192N/A£3,340£686£1,372
New Rules from 1 July 2024£45,00019237%£16,650£3,300£6,600
Increase in Tax£2,614£5,228

Scott Whitmore is Dafferns’ Senior Corporate Tax manager and is happy to assist should you have any concerns with your tax affairs.