UK & Ireland Commercial and VAT reclaim

[jamesfielding]

This is entirely my point, you can't apply that super deduction to the Grenadier as HMRC class it as a car, not a van, or a car derived van. You will only get 6% PA back. This is one reason for my dismay.

So due to the less that 1ton payload but heavier than 2.1ton vehicle weight you believe it will be classed as a non-commercial vehicle?

 

[JOB]

So due to the less that 1ton payload but heavier than 2.1ton vehicle weight you believe it will be classed as a non-commercial vehicle?

That is the view my accountant is taking and having read the guidance online, I suspect he isn't wrong. There are possible grey areas as a result of the size of the load space may be bigger than the passenger compartment but I'm not holding my breath.

 

[Tom D]

Its very confusing. Its classed but DVLA as commercial. But the rules for BIK are different…
The grenadier falls into neither of these categories..

Car-derived vans and dual purpose vehicles

www.gov.uk

 

[jamesfielding]

well that will be a huge cock-up if the 5 seater “N1” isn’t classed as such, as I imagine quite a few people are in that boat.

 

[Tom D]

As vehicles have got heavier over the years our laws are due for an overhaul. The 3.5 ton class needs upgrading to 4.5 ton as in Europe. And the BIK definitions could do with an upgrade two.
Essentially the Grenadier commercial falls into the same category variants of the ford transit van, some of which like the double cab tipper can only cary 900kg or so. This gives them a kerb weight over the 2040kg BIK limit. The issue is that the transit is less likely to be used as a daily runabout, even though there will be plenty of builders and tradespeople who do…

 

[jamesfielding]

For me it was either a IG or another pickup, so opted for the IG as something a bit more unusual etc, assuming as a company car, the business can reclaim the VAT. As all literature on the internet says its classed as a commercial (just FYI - I've ordered a 5 Seat Utility Wagon), I am going to argue the case and hope for the best.

Just to confirm, your accountant believes it is not a commercial, but Ineos still states it is?

 

[Tom D]

It IS commercial as far as DVLA are concerned but it is NOT a commercial as far as HMRC are concerned…. Go figure!

But then any ‘commercial’ which has 5 seats and weighs more than 2040kg is ‘not’ a commercial for tax purposes.. I think the payload is irrelevant.
Many vehicles fall into this category, most double cab Luton and tipper vans such as Iveco, cabstar, transit, fuso and possibly some double cab 4x4’s too.

 

[Tom D]

For example all of the 4x4 Mercedes xclass pick ups weigh over the 2040kg limit…

https://www.mercedes-benz.com.au/vans/content/dam/vans/australia/models/brochures-and-specifications/x-class/x-class-technical-data.pdf

 

[JOB]

I am going to argue the case and hope for the best.

Just to confirm, your accountant believes it is not a commercial, but Ineos still states it is?

That's probably what I am going to do as well. I don't mind the lack of tax deduction, but I want the VAT back. If the vehicle has to be 'business only', so be it. It will still make the working day that bit more pleasurable!

I emailed my agent this morning and received a defensive reply, at odds with my previous enquiries and the early rhetoric given by Ineos. It wouldn't be fair to share on a public forum but I would divulge privately.

 

[jamesfielding]

For example all of the 4x4 Mercedes xclass pick ups weigh over the 2040kg limit…

https://www.mercedes-benz.com.au/vans/content/dam/vans/australia/models/brochures-and-specifications/x-class/x-class-technical-data.pdf

I understand the payload bit, so over 1ton you're winning. The landmark case between HMRC and Coca Cola regarding VW Transit Kombi vans, just makes things more of a grey area.
As DVLA classify the vehicle as commercial, I am going to go with that, considering they are the "Authority" on vehicles

 

[Tom D]

I have not seen any reference to payload in the HMRC docs, it is all about the kerb weight, so while the grenadier kerb weight is 2700kg or so the gross weight is 3500 whereas you’ll notice the Merc is 3250.. payload is irrelevant here. Its all about the kerb weight.

 

[jamesfielding]

I have not seen any reference to payload in the HMRC docs, it is all about the kerb weight, so while the grenadier kerb weight is 2700kg or so the gross weight is 3500 whereas you’ll notice the Merc is 3250.. payload is irrelevant here. Its all about the kerb weight.

Here HMRC say that pickups are a car, but as they have a 1ton payload, they are then a van

EIM23150 - Car benefit: double cab pick ups - HMRC internal manual - GOV.UK

www.gov.uk

 

[JOB]

I have not seen any reference to payload in the HMRC docs, it is all about the kerb weight, so while the grenadier kerb weight is 2700kg or so the gross weight is 3500 whereas you’ll notice the Merc is 3250.. payload is irrelevant here. Its all about the kerb weight.

"Double-cab pick-ups and car-derived (kombi) vans add an extra layer of confusion. This is because while you might be using such a vehicle as a van, the additional row of seats means that HMRC may define it as a car. In order to be classed as a “commercial vehicle” (and qualify for tax reliefs), it needs to have a payload of more than one tonne after seats and have a dedicated load area that is larger than the passenger area."

TTR Barnes

Car or van? HMRC rules on vehicle classification may not be what you'd expect. Here are some things to bear in mind when it comes to vehicle tax relief.

www.ttrbarnes.com

 

[Tom D]

https://media.ford.com/content/dam/fordmedia/Europe/documents/productReleases/Ranger/FordRanger2016_TechnicalSpecifications_EU.pdf

The ford ranger and Nissan Bavaria double cabs also fall into the same category as the grenadier…

 

[jamesfielding]

Here is something else I've found

Land Rover Defender Station Wagons​

HMRC has always considered these vehicles to be cars for tax purposes for the reasons given above, i.e. that

• they are mechanically propelled road vehicles, and
• none of the exceptions in s115(1) (EIM23100) apply to prevent them being cars.

 

[Tom D]

"Double-cab pick-ups and car-derived (kombi) vans add an extra layer of confusion. This is because while you might be using such a vehicle as a van, the additional row of seats means that HMRC may define it as a car. In order to be classed as a “commercial vehicle” (and qualify for tax reliefs), it needs to have a payload of more than one tonne after seats and have a dedicated load area that is larger than the passenger area."

TTR Barnes

Car or van? HMRC rules on vehicle classification may not be what you'd expect. Here are some things to bear in mind when it comes to vehicle tax relief.

www.ttrbarnes.com

Well spotted, many of the double cab vans still have a payload of less than a ton though. I guess thats why they sell them as chassis cabs and then the tippers are fitted after market..

 

[jamesfielding]

Ahh screw it, following the DVLA - commercial vehicle.

edit:

New INEOS Grenadier Station Wagon Offer | Lloyd AllRoad

Get exclusive access to the New INEOS Grenadier Station Wagon at Lloyd AllRoad. Click to Browse and learn more about our exclusive offers.

www.lloydmotorgroup.com

 

[Tom D]

For most people who are running a business I would imagine that you can use the pool car exemption if you are sensible. It will be difficult of sole traders or those with no employees. Mine will be used by my staff so no issues there and as we are contracted to supply a 24 hour call out service we can take vehicles home too. There may be some people who get caught out though…

 

[jamesfielding]

For most people who are running a business I would imagine that you can use the pool car exemption if you are sensible. It will be difficult of sole traders or those with no employees. Mine will be used by my staff so no issues there and as we are contracted to supply a 24 hour call out service we can take vehicles home too. There may be some people who get caught out though…

That is a very good point, thank you for all the useful inputs, frustrating that we have to be worrying about this so close to the finish line!

 

[tartan shepherd]

Our N1 will be going into a farm partnership as a pool vehicle. Our accountant has confirm he see's no issue with reclaiming the vat. And capital allowances. Whether that will be 23/24 tax year or 24/25 may still be open to debate!