UK & Ireland Ineos Grenadier and UK HMRC BIK classifications for 2 and 5 seat Commercials

[oliverwood]

Hi

I am new on here and sorry if this has been answered elsewhere, but I couldn't see anything.

Has anyone got a definitive answer as to how are the Ineos Grenadier Commercial variant 2 and 5 seat models classed with the UK HMRC in relation to BIK?

Ineos has stated the commercials are both N1 and as such are light goods vehicles or vans. I know however HMRC live in their own little world. Would be nice if HMRC also maintained an up-to-date list of all N1 type vehicles (pre-OEM alterations) and how they deem then in HMRC land, with out the grey mist the cover everything in.

I called HMRC and asked them and one of their call handlers after asking the question came back with that they are vans, but I'm sure that conversation would vanish like ice does on a hot day if it had to.

Basically are they down as a van with the fixed BIK value (£3,600) or are they based on their value and emissions as a car is?

Any past experience, pointers or advice would be greatly appreciated.

Thanks in advance

Olly

 

[DCPU]

HMRC do indeed live in their own world and N1 status is a red herring.

For HMRC and BIK, there's separate legislation and a separate vehicle test.

If you have the time, this is a good read:

Payne & Ors v Revenue And Customs [2020] EWCA Civ 889 (20 July 2020)

And if you look at what was said in the First-tier Tribunal:

"Mr Phillips also referred to Directive 2007/46/EC in relation to vehicle definitions. He noted that the three vehicles involved in this appeal could be classified as M class (cars) or generally N class (commercial vehicles), subject to final adaptation and intended use. Again, I found this reference to this Directive of very limited relevance, because the statutory test is different."

 

[Tallzsmallz]

Hi

I am new on here and sorry if this has been answered elsewhere, but I couldn't see anything.

Has anyone got a definitive answer as to how are the Ineos Grenadier Commercial variant 2 and 5 seat models classed with the UK HMRC in relation to BIK?

Ineos has stated the commercials are both N1 and as such are light goods vehicles or vans. I know however HMRC live in their own little world. Would be nice if HMRC also maintained an up-to-date list of all N1 type vehicles (pre-OEM alterations) and how they deem then in HMRC land, with out the grey mist the cover everything in.

I called HMRC and asked them and one of their call handlers after asking the question came back with that they are vans, but I'm sure that conversation would vanish like ice does on a hot day if it had to.

Basically are they down as a van with the fixed BIK value (£3,600) or are they based on their value and emissions as a car is?

Any past experience, pointers or advice would be greatly appreciated.

Thanks in advance

Olly

Olly,

I am also new to the forum & desperately seek answers re BIK/VAT.

Ive ordered a 5 seater commercial thinking that it would be fine having read some posts but now I’m not so sure.

It seems crazy if they’ve produced a vehicle that is registered as an N1 commercial vehicle (increased payload, reduced passenger area etc) but to the driver it’s worthless as you’re taxed as if you’re driving a car which is what I discovered last night on a BIK commercial vehicle calculator.

I don’t want to take delivery of an awesome vehicle to be hit by huge monthly tax payments.

I have asked Ineos for clarification but no news yet.

 

[oliverwood]

Olly,

I am also new to the forum & desperately seek answers re BIK/VAT.

Ive ordered a 5 seater commercial thinking that it would be fine having read some posts but now I’m not so sure.

It seems crazy if they’ve produced a vehicle that is registered as an N1 commercial vehicle (increased payload, reduced passenger area etc) but to the driver it’s worthless as you’re taxed as if you’re driving a car which is what I discovered last night on a BIK commercial vehicle calculator.

I don’t want to take delivery of an awesome vehicle to be hit by huge monthly tax payments.

I have asked Ineos for clarification but no news yet.

Tallzsmmallz

Well after speaking to our accountants (Their BIK specialist) as well as the people at Commcar, when I queried why the Utility version wasn't on their van website (After which they only put the 2 seater utility on to their van website and no the 5 seater) I decided to go for the 2 seat Grenadier.

I too asked INEOS the same question 2-3 weeks ago and had no reply. I doubt they would want to put the heads on the block legally in this area.

It seems pretty clear now that HMRC deffinetly treats BIK and VAT separately.

Two of their main criteria are the split between passenger and cargo (the 5 seat is biased towards carrying passengers over cargo even though the seat can be folded down) as well as it seems when 5 seats are involved it must have at least a 1-tonne payload and as the grenadier doesn't this.

So the N1 classification covers you for VAT retrieval, but it may be difficult to justify the 5-seat as a van for BIK. This is why I have decided to go for the 2-seat utility and not the 5 seats as I don't want a big surprise tax bill.

Like DCPU said in their post and referring to when Coke was challenged by HMRC they lost and this seems to have set a precedence. Unfortunately, it was probably the employees that had to put their hands in their pockets. HMRC can also apply the BIK tax retrospectively.

I will see next time around about getting a 5-seater if things change with HRMC and another brave soul has crossed swords with them and won.

It seems HMRC move the goalposts to ensure they win an argument.

Probably not the positive answer you were looking for, but I hope this helps anyway.

Olly

 

[Tallzsmallz]

Sadly I tend to agree with you, it Seems that the only way that Ineos could hit the ground running in the uk was to offer up the N1 commercials in 2 seater & 5 seater versions, it’s a real shame as this makes the 5 seater worthless/pointless, I did a tax calculation & at 40% taxpayer it’s circa 7x the figure I pay for a pickup.

A 2 seater doesn’t work for me for home life so I’ll cut my losses & wait for further information on the pickup which hopefully will have the 1 tonne payload…

 

[Davman]

Yeah, missing the 1 Tonne payload is a big negative for commercial vehicles here in OZ too.

 

[DaveB]

I was trying to see which vehicles here in Australia actually have a 1 tonne payload and couldn't find many/any
Ineos have revised their payload figures I notice
*90% Fuel and all liquids (no driver

 

[Davman]

Yeah - a version of the new Ford Ranger gets close at 997kgs - but that’s it.
It’s almost like manufacturers don’t want to go over the 1t - must be some reason why.

 

[DCPU]

It seems crazy if they’ve produced a vehicle that is registered as an N1 commercial vehicle (increased payload, reduced passenger area etc) but to the driver it’s worthless as you’re taxed as if you’re driving a car which is what I discovered last night on a BIK commercial vehicle calculator

N1 status is only as good an indicator insofar as it relates to the VED/road fund tax; and there everyone is getting a huge tax saving over having the vehicle registered as a car (M1).

So it's not crazy in that sense; or at least not to those who can live with the compromises this entails.

It's the common misapplication of N1 status to infer there's any BiK benefits to also be had from N1 status alone that leads to all the confusion. UK tax law is often confusing, outdated and certainly over complex at times.

 

[Slowveryslow]

N1 status is only as good an indicator insofar as it relates to the VED/road fund tax; and there everyone is getting a huge tax saving over having the vehicle registered as a car (M1).

So it's not crazy in that sense; or at least not to those who can live with the compromises this entails.

It's the common misapplication of N1 status to infer there's any BiK benefits to also be had from N1 status alone that leads to all the confusion. UK tax law is often confusing, outdated and certainly over complex at times.

I’ve ordered a 5 seat commercial purely for the VED saving…is that the case or am I mistaken?

 

[Tallzsmallz]

I was perhaps naive to think that there would be around it…

I was buying as a direct replacement for my L200 which is a “company car” bought for me by my employe, they make a tax saving on purchase & then I pay a very low BIK for the truck & fuel.

Sadly as indicated it appears that the N1 status means that the employer can still claim the tax back (if they’re vat registored) but the vehicle is classed as a passenger vehicle (due to payload etc) so I would pay at least 6x what I currently pay to run as a company car.

its not like I’m an office worker trying to play the system, we work in construction so constantly towin & transporting materials to site but at the weekends using as a family car.

Does anyone have any indication on the payload of the pick up version? I’ll cancel my order for the 5 seater & wait I guess.

I only cancelled my order for an Isuzu this week

 

[rovie]

I was perhaps naive to think that there would be around it…

I was buying as a direct replacement for my L200 which is a “company car” bought for me by my employe, they make a tax saving on purchase & then I pay a very low BIK for the truck & fuel.

Sadly as indicated it appears that the N1 status means that the employer can still claim the tax back (if they’re vat registored) but the vehicle is classed as a passenger vehicle (due to payload etc) so I would pay at least 6x what I currently pay to run as a company car.

its not like I’m an office worker trying to play the system, we work in construction so constantly towin & transporting materials to site but at the weekends using as a family car.

Does anyone have any indication on the payload of the pick up version? I’ll cancel my order for the 5 seater & wait I guess.

I only cancelled my order for an Isuzu this week

An INEOS representative told me that the payload is probably only about 1 tonne. That would not be much. I was also interested in the pickup.

 

[JOB]

Is the simple way around this not to register the N1, commercial variant as a company pool vehicle and allow one of your employees to run an errand in it every now and then?

Edit/ another consideration. What about the likes of Vauxhall Combo and Ford Fiesta vans? They will be classified as N1 and will have payloads of nowhere near 1T yet I’m sure any BIK will still reflect the fact that they’re vans?

 

[Tallzsmallz]

1 tonne is enough to qualify as a pickup for BIK, anything less & we’re in a whole world of hurt!

 

[Tallzsmallz]

Is the simple way around this not to register the N1, commercial variant as a company pool vehicle and allow one of your employees to run an errand in it every now and then?

I dont think you’d get away with that in this day & age, HMRC are so switched on - if you get caught out via an audit you’re in a whole world of hurt.
tax laws in uk are rubbish.

 

[DCPU]

I’ve ordered a 5 seat commercial purely for the VED saving…is that the case or am I mistaken?

If it's N1, then you'll pay the N1 rate of VED.

 

[JOB]

If it's N1, then you'll pay the N1 rate of VED.

I hope you’re right. I found myself down something of a rabbit hole researching tax laws.

 

[DCPU]

First year's tax is included in the OTR costs, so that should be a clear indication of what Ineos want to charge you.

 

[Tallzsmallz]

Sadly I’ve cancelled my order today, I can I’ll afford a tax bill if as feared HMRC tax as a passenger vehicle from a BIK perspective.
Fortunately the Isuzu DMax I’ve had on order since Feb is still available so I’ve got that coming next month, hopefully the next vehicle change in 3yrs will be clearer.
good luck to all you future lucky Ineos owners.

 

[Cheshire cat]

Sometimes one has to keep a clear perspective. It is after all just a vehicle. One I am looking forward to I admit but not something that will change my life. Best of luck with the D Max