Double-cab pickup trucks have been classified as vans for company car tax purposes for over two decades. However, this is set to change from April 2025.
Double-cab pickups are hugely popular vehicles, especially in the farming and construction sectors. Since April 2002, they have been treated as vans for tax purposes. Within the autumn budget announcements was confirmation of changes from next April. This will hugely impact the tax liability of those driving the vehicles and the companies owning the pickups.
The new guidance states a double-cab pickup is to be treated as a car even if the payload of the vehicle is over one tonne. This applies from 1 April 2025 for income tax and 6 April 2025 for corporation tax.
This approach will increase tax bills arising from the new benefit-in-kind (BIK) treatment. Owners of some vehicles will see a massive rise from the current fixed annual BIK charge of £3960, which is applied to all light-commercial vehicles, to a possible BIK charge of £22,200. This would lead to a tax bill of £8880 a year for a 40% taxpayer. Wow!
Transitional arrangements are in place for employers who purchase, lease or order a double cab pickup before 6 April 2025. They will be able to use the previous treatment until 5 April 2029 unless their lease or ownership of the vehicle ends before then.
Does the new guidance affect your business?
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