Do HMRC think my van is a car?

[dilbu]

Hi all -

I've been planning on a new T6 van to convert to a camper this spring; I work as a videographer and travel quite a bit around the place on shoots with a bunch of gear; the majority being in rural areas. I also have previously been a member of a coworking space which went under due to the pandemic, so having a van i could travel in, carry gear, stay in for the day to do edits etc and also potentially sleep in makes a lot of sense. I of course would use it with my wife on and off but I can totally justify the use of it as a portable office/work vehicle. However my accountant has come back to me and said that as soon as I put a seat in the back (let alone a rock and roll bed) then the HMRC class my van as a car, citing this case, and therefore I cannot claim it as a commercial vehicle (making it pointless to put through my limited company). Seems crazy to me for a variety of reasons, but I was wondering if anyone had come up against this and knew how absolute it was and if there's a workaround? The case specifically relates to crew cab kombi's but I'm not sure how these legal precedents work really.

Thanks!

 

[JOG]

Do you intend buying the van from your company when you’re done? Do you intend putting the conversion costs through your company?

 

[Sackmycook]

I believe factory Kombi's are classed as dual-purpose vehicles.....

 

[Murdoch]

I believe factory Kombi's are classed as dual-purpose vehicles.....

that’s what a large uk company thought until HMRC told them otherwise

Hazlewoods

www.hazlewoods.co.uk

 

[JOG]

You can buy a commercial vehicle and be straight with your accountant and therefore HMRC! You can do things to the commercial vehicle post purchase and be silent with those entities!

 

[JOG]

that’s what a large uk company thought until HMRC told them otherwise

Hazlewoods

www.hazlewoods.co.uk

As did a large UK telco!!!

 

[MickW]

Hi Same issue so we purchased the van a t6 and claimed the vat in 2016 tax year
During the next tax year (due to our converter) we claimed for conversion in several different invoices.
insulation and lining
electrics and kitchen
pop up roof
RIB bed
I have a feeling that we decided against claiming for one element to keep our accountant happy I could dig this out if it helps. However we still put all invoices through the business
Were about to buy the van out of the business and it all appears to have gone well, we haven’t had a vat inspection thou

Im not sure what effect this has had on the right down of the van and I’m not overly worried as i didn’t want to push the issue.
Hope that helps and don’t forget that your accountant works for yo.

Mick w

 

[jimc91]

Hi Same issue so we purchased the van a t6 and claimed the vat in 2016 tax year
During the next tax year (due to our converter) we claimed for conversion in several different invoices.
insulation and lining
electrics and kitchen
pop up roof
RIB bed
I have a feeling that we decided against claiming for one element to keep our accountant happy I could dig this out if it helps. However we still put all invoices through the business
Were about to buy the van out of the business and it all appears to have gone well, we haven’t had a vat inspection thou

Im not sure what effect this has had on the right down of the van and I’m not overly worried as i didn’t want to push the issue.
Hope that helps and don’t forget that your accountant works for yo.

Mick w

If you get a vat visit you will be asked to explain how the purchase of a kitchen, bed and pop up roof is business related - I would expect them to disallow the tax and for you to get an assessment to reclaim the tax, of course if you don’t get a visit then you won’t.

 

[JOG]

If you get a vat visit you will be asked to explain how the purchase of a kitchen, bed and pop up roof is business related - I would expect them to disallow the tax and for you to get an assessment to reclaim the tax, of course if you don’t get a visit then you won’t.

Yep - what @jimc91 said!

 

[Luke78]

I am going through same although I don’t plan to convert. From my understanding you need to separate the VAT and then the Annual Investment Allowance and Benefit in Kind out. For VAT purposes you can still claim VAT back if payload is over 1 tonne ie a T32, that hasn’t changed. What had changed is HMRC view vans with windows behind driver or a second row of seats as cars for AIA and benefit in kind purposes which could have a big effect for people with limited companies claiming AIA

 

[Luke78]

Only effects benefit in kind of there is personal use ie if 100% business then no effect, just remember to take out the car seats if the tax man visits!!

 

[jack454]

I am going through same although I don’t plan to convert. From my understanding you need to separate the VAT and then the Annual Investment Allowance and Benefit in Kind out. For VAT purposes you can still claim VAT back if payload is over 1 tonne ie a T32, that hasn’t changed. What had changed is HMRC view vans with windows behind driver or a second row of seats as cars for AIA and benefit in kind purposes which could have a big effect for people with limited companies claiming AIA

swapped from a t32 kombi in december to a t30 kombi

the 32 has always been classed as a "" van "" for Bik, whereas the 30 i was led to believe was not, and would be classed as a car

has several conversations with HMRC, refagrding the coca cola ruling and the requirement to declare the t30 as a "" company car " ( ps, accepted this to be the case if i got another kombi company vehicle)

upon the calls, and attempting to declare as a car, HMRC, could not enter that on their system, as, even after the ruling, there is still no official hmrc guidance been issued which affects the BIK status

i have had to declare this as a " van " for BIK purposes, and also, have had to sign an agreemement with the company that IF and WHEN hmrc release the full guidance notes, i will be liable for any back tax and future tax due from the date of recieving said Kombi

hey ho, for some, this may be a financial kick in the balls, but a few things are certain in life, you are going to die eventually, and before that, you are going to pay tax, in someway shape or form

 

[Kramsdog]

I had a similar conversation with my accountant, also with my brother who’s a Coke employee with a VW van. My intention was to fully convert the van, a T30, from the onset, so ticked on the order lots of nice add ons.
After lots of chats decided to buy it privately, used Vw finance and received 4 free services and an extra £1500 discount on top of the dealer discount. The big plus no worries with HMRC ever knocking on the business door, which they have once.

 

[dilbu]

swapped from a t32 kombi in december to a t30 kombi

the 32 has always been classed as a "" van "" for Bik, whereas the 30 i was led to believe was not, and would be classed as a car

has several conversations with HMRC, refagrding the coca cola ruling and the requirement to declare the t30 as a "" company car " ( ps, accepted this to be the case if i got another kombi company vehicle)

upon the calls, and attempting to declare as a car, HMRC, could not enter that on their system, as, even after the ruling, there is still no official hmrc guidance been issued which affects the BIK status

i have had to declare this as a " van " for BIK purposes, and also, have had to sign an agreemement with the company that IF and WHEN hmrc release the full guidance notes, i will be liable for any back tax and future tax due from the date of recieving said Kombi

hey ho, for some, this may be a financial kick in the balls, but a few things are certain in life, you are going to die eventually, and before that, you are going to pay tax, in someway shape or form

Thanks - do you have any info on the T32 vs t30. I'm assuming this is to do with weight somehow?

 

[Deaky]

T32/T30 debacle is to do with VAT and not BIK. As far as the VAT man is concerned a dual purpose vehicle must be able to carry 1 ton in the back to be classed as commercial. A T30 can't, a T32 can

 

[dilbu]

Do you intend buying the van from your company when you’re done? Do you intend putting the conversion costs through your company?

I guess I don't know the answer to those at this stage; depends what is best

If you get a vat visit you will be asked to explain how the purchase of a kitchen, bed and pop up roof is business related - I would expect them to disallow the tax and for you to get an assessment to reclaim the tax, of course if you don’t get a visit then you won’t.

Yeah I was thinking of just claiming the van itself, although in truth I would be using the camper interior quite a bit as a remote office, so did wonder if a percentage could be claimed based on use; I mean that's what you can do with your home interior.

T32/T30 debacle is to do with VAT and not BIK. As far as the VAT man is concerned a dual purpose vehicle must be able to carry 1 ton in the back to be classed as commercial. A T30 can't, a T32 can

Ah shit, shows what I know. I thought it was called a T30 because it could carry 3.0 tonnes; haha my bad! So that means my plans to claim VAT back on a T28 are null and void anyway!

 

[Kramsdog]

Thanks - do you have any info on the T32 vs t30. I'm assuming this is to do with weight somehow?

It’s the Gross vehicle weight,
T28 = 2800kg
T30 = 3000kg
T32 = 3200kg
ie
gross vehicle weight - kerb weight = load capacity

kerb weight = weight of empty van
load capacity = how much stuff you can put in it

hope it helps

 

[Deaky]

Ah shit, shows what I know. I thought it was called a T30 because it could carry 3.0 tonnes; haha my bad! So that means my plans to claim VAT back on a T28 are null and void anyway!

If your T28 is a Kombi then you can't (legally) claim the VAT back, if you T28 is a panel van then you can.

 

[jack454]

T32/T30 debacle is to do with VAT and not BIK. As far as the VAT man is concerned a dual purpose vehicle must be able to carry 1 ton in the back to be classed as commercial. A T30 can't, a T32 can

the bik and vat things are pretty much running side by side

bik on a " commercial"" classed it as such, and you only declared the vehicle as a " van " for bik purposes ( t32) and vat was claim backable

bik on the t30 is not commercial ( vw state this on their paperwork now , unlike previously) hence, in theory, taxed as a company car ( but still no official guidance notices available) hence it still is getting declared as a van until such a time, the official notes are released

 

[dilbu]

the bik and vat things are pretty much running side by side

bik on a " commercial"" classed it as such, and you only declared the vehicle as a " van " for bik purposes ( t32) and vat was claim backable

bik on the t30 is not commercial ( vw state this on their paperwork now , unlike previously) hence, in theory, taxed as a company car ( but still no official guidance notices available) hence it still is getting declared as a van until such a time, the official notes are released

Do you think that means when the notes are released you'll have to backpay, or are you fine beause at the time there were no notes.