Hi do you know the payload for a 204 DSG T32 4Motion?I'd defer all advice to an accountant before making a purchase but my understanding is that the Kombi is allowable so long as its payload is over 1000kg.
For my spec (ordered a 204ps DSG T32 Highline) this meant omitting the 4Motion option. I believe you could punt for 150ps and include 4Motion, or various other configurations.
You have to prove to the VAT office that it is a true multi-use vehicle by keeping its payload above 1t. The Revenue's tax department are more concerned with its vehicle class on V5c; N1 rather than M1. The Kombi passes this test where the Caravelle fails it
There are similar threads around here discussing this too
I'm trying to get my head around how so many people run Transporter Kombis through their business.
As I understand it:
T32 Kombi SWB has payload >1000kg so a van for VAT purposes (so can reclaim 20% VAT) and for capital allowances purposes (so can claim 100% allowance in first year, offsetting cost against income and so saving tax).
But, recent events suggest HMRC treating Kombis as cars for Benefit in Kind purposes, so if there's any private use, then there is a large BIK tax bill.
For vans with <1000kgs, there's not the ability to reclaim 100% capital allowances, and probably not theVAT either (as they are not officially commercial vehicles).
So, how come there are so many for sale at +VAT prices, even the <1000kg payload ones, which means they have been company run. I assume it's either
(i) no personal use
(ii) used but assumed not likely to be caught
(iii) used but declared as van for BIK and not likely to be caught.
What are people's experiences, and what have I missed?
As I understand it:
T32 Kombi SWB has payload >1000kg so a van for VAT purposes (so can reclaim 20% VAT) and for capital allowances purposes (so can claim 100% allowance in first year, offsetting cost against income and so saving tax).
But, recent events suggest HMRC treating Kombis as cars for Benefit in Kind purposes, so if there's any private use, then there is a large BIK tax bill.
For vans with <1000kgs, there's not the ability to reclaim 100% capital allowances, and probably not theVAT either (as they are not officially commercial vehicles).
So, how come there are so many for sale at +VAT prices, even the <1000kg payload ones, which means they have been company run. I assume it's either
(i) no personal use
(ii) used but assumed not likely to be caught
(iii) used but declared as van for BIK and not likely to be caught.
What are people's experiences, and what have I missed?
BIK only affects employees so either a normal employee or someone on the payroll of their own ltd company, if you are self employed (sole trader/partnership) then this doesn’t come into it.
VAT reclaim still stands but most of this is subjective, if it is questionable then you need to speak to your accountant for clarification
Lots of people need a van and buy a Kombi and that is where the grey line appears, if you need to transport people as well as tools (or just people) then kombis are fine
At the end of the day you can buy anything and put it through the books but if you get looked at them you need to be able to justify it or accept the punishment
VAT reclaim still stands but most of this is subjective, if it is questionable then you need to speak to your accountant for clarification
Lots of people need a van and buy a Kombi and that is where the grey line appears, if you need to transport people as well as tools (or just people) then kombis are fine
At the end of the day you can buy anything and put it through the books but if you get looked at them you need to be able to justify it or accept the punishment
PV myself. . . . . . I have no idea. The accountant deals with it all. But apparently I get a good deal.
As if by co-incidence I've just had my P11D through. Fixed van BIK of £3350. This was for the previous Vivaro, but my T6 is being treated the same. LWB PV.
This is an interesting article on an HMRC ruling about Kombis;
When is a van a company car? Coca-Cola tax ruling 'confusing'
Based on this, I could see issues for people running Kombis as detailed, with a fixed partition, however with no bulkhead and seat(s) removed, it's a predominantly a goods carrying vehicle.
The £3350 BIK of vans is a good deal. SWMBO pays a lot more on a ecoblue 320D firm's car.
This is an interesting article on an HMRC ruling about Kombis;
When is a van a company car? Coca-Cola tax ruling 'confusing'
Based on this, I could see issues for people running Kombis as detailed, with a fixed partition, however with no bulkhead and seat(s) removed, it's a predominantly a goods carrying vehicle.
The £3350 BIK of vans is a good deal. SWMBO pays a lot more on a ecoblue 320D firm's car.
Fee the Coca-Cola ruling, I've read it in detail, and it's massively precise in parts, and frustratingly loose in others. So it's not clear whether it was a LWB or SWB, and whether it was a T32 or other. But one of the points was that, even with the seats removed, it was constructed to carry both people and good equally and so would be called a car. If the seats were locked away and inaccessible, and the fitting of them was time consuming, then it helps to suggest it's a van. In the Coke case, they had to have the seats out during the week - but it still was called a car..... So they were hit with a backdated car BIK bill plus interest and fines.... quiet a lot of money c.f. the van BIK..... (hence a thread I've posted elsewhere asking for the dimensions of the 'passenger carrying area' i.e. back of rear seats to (a) steering wheel top (b) front bulkhead in front of brake pedal. If both are smaller than the load space on a LWB I can argue it successfully, I think - for a SWB, I think the argument is already lost as it's been to Tier 1 tax tribunal, and to appeal.....
I’m a director of my own company and have a T32 SWB and have been told I have to declare it as a car (with immediate effect) my accountant is very conservative so I sought advice from two accountant friends who are both prepared to take more risks, one subscribes to Cromer for advice and the guidance that he/they are both saying is the same thing, it’s a car. Worse still is they are apparently back dating the tax (not sure how far back).
It’s very frustrating, no guidance on usage, just seems like a blanket decision. My van is sign written, it’s a commercial vehicle on the log book, claimed that VAT etc and genuinely use it for business by both me and my staff and I have to either get rid of it and buy a car (useless for my type of work) or purchase it off the company and charge the mileage back.
Apparently Coca Cola are not appealing the third tier decision so it looks set to be enforced but HMRC are still going after the Vivaro’s (they’re not happy the lost that part of their case)
The one strange thing I can pick out of the report is that it seems that Coca Cola have had the vans converted themselves, it looks like they haven’t used factory Kombi’s.
I called the HMRC helpline to ask their advice and they said “if it says commercial on the log book it’s a commercial for tax purposes!” Seems the right hand doesn’t know what the left hand’s doing.
It’s very frustrating, no guidance on usage, just seems like a blanket decision. My van is sign written, it’s a commercial vehicle on the log book, claimed that VAT etc and genuinely use it for business by both me and my staff and I have to either get rid of it and buy a car (useless for my type of work) or purchase it off the company and charge the mileage back.
Apparently Coca Cola are not appealing the third tier decision so it looks set to be enforced but HMRC are still going after the Vivaro’s (they’re not happy the lost that part of their case)
The one strange thing I can pick out of the report is that it seems that Coca Cola have had the vans converted themselves, it looks like they haven’t used factory Kombi’s.
I called the HMRC helpline to ask their advice and they said “if it says commercial on the log book it’s a commercial for tax purposes!” Seems the right hand doesn’t know what the left hand’s doing.
I can help with one part of that as I've been embroiled in "negotiations" with HMRC that have been going on for almost 18 months now (not on this matter). If they decide that you have been mis-declaring retrospectively, they can (and will!) go back 6yrs plus the current tax year.
(not on this matter). If they decide that you have been mis-declaring retrospectively, they can (and will!) go back 6yrs plus the current tax year.Hello, so after get the money together to buy a used vw 204 dsg 4 motion I start to find out about the whole Vat / BIK nightmare! After a lot of reading up it looks like the 4 motion is a no go.. even VW commercials in Manchester confirmed the bad news! The payload being 966kg. So Im back to looking at the 150 and the 204 dsg SWB Kombis.. No my Accountant has sent me this to read!
VIT50900 - VAT Input Tax - HMRC internal manual - GOV.UK
And with the whole Coca cola case I'm not sure if any Kombi can be classed as a van! if so no vat reclaim or business tax benefits!
Thoughts from the group appreciated as its a lot cash to spend and I cant afford the Vat man to say hey you can't claim for that after the purchase! thats about 7K of vat..
Many thanks for any assistance.. shame this might be my first and last post!
Simon
VIT50900 - VAT Input Tax - HMRC internal manual - GOV.UK
And with the whole Coca cola case I'm not sure if any Kombi can be classed as a van! if so no vat reclaim or business tax benefits!
Thoughts from the group appreciated as its a lot cash to spend and I cant afford the Vat man to say hey you can't claim for that after the purchase! thats about 7K of vat..
Many thanks for any assistance.. shame this might be my first and last post!
Simon
Update... My accountant has a good look into now! He's now up to speed on it all and he's happy to along with the vat reclaim on the basis that the new van would have a payload over the tonne mark.. Sorry to clog up the Forum with dull vat news... right then lets start looking at possibly from end options.
Beware!
That 1 tonne aspect has been stated as not relevant to vans (I know, it doesn't make sense, especially when you consider pick ups - but thats HMRC for you). My accountant would not consider it.
Ask yourself this: If HMRC disagree, who pays the bill?
Having said that, I notice that the guidance you have linked to was updated in April - so maybe things have changed...?
So if your accountant is willing to back that assertion up (& foot the bill if they're wrong) then go for it!
Thanks Shaun.. This shouldn't be this hard... The V5 says N1,,, the insurance needs to be for a van. its over a tonne. Its going through the books as a commercial vehicle for tax ( I have a car as well ) , How does VW sell any Kombis?
I know that list is pointless.. my accountant is going off this ( part iv / 4 )
VIT50300 - VAT Input Tax - HMRC internal manual - GOV.UK
Just trying to bring this thread back to life as I'm also interested in how this all works.
Are people on here buying T6 SWB Kombi's and putting them through their own companies? I'm a director of my own company and need a 'van' for work but also need to transport my crew & clients around at times. Surely this is allowed?
Does it make any difference on how much the vehicle has been modified? The reason I ask is that I don't want to be driving around in a crappy old panel van!
I have a certain image that I want to project and clients to impress. If I'm driving around all week in a van then it needs to be a nice place to be.
Any thoughts or advice people? Anyone been stung by HMRC or had direct dealings about this?
Cheers
Are people on here buying T6 SWB Kombi's and putting them through their own companies? I'm a director of my own company and need a 'van' for work but also need to transport my crew & clients around at times. Surely this is allowed?
Does it make any difference on how much the vehicle has been modified? The reason I ask is that I don't want to be driving around in a crappy old panel van!
I have a certain image that I want to project and clients to impress. If I'm driving around all week in a van then it needs to be a nice place to be.
Any thoughts or advice people? Anyone been stung by HMRC or had direct dealings about this?
Cheers
I gave up (Ltd company) and just bought it privately ... the 'varying Accountants opinions' and the 'grey line' already referred to just set too many alarm bells ringing for me. Folks I asked admitted one-to-one, they were just trying it on and knowingly taking a risk. My view is, most people are likely to lose any fight with HMRC and then have potential 'x' year's of back tax to very begrudgingly hand over, in addition to a possible Plod record.
As usual with rip off Britain, it's a car for tax purposes but a van for speeding fines
... the 'varying Accountants opinions' and the 'grey line' already referred to just set too many alarm bells ringing for me. Folks I asked admitted one-to-one, they were just trying it on and knowingly taking a risk. My view is, most people are likely to lose any fight with HMRC and then have potential 'x' year's of back tax to very begrudgingly hand over, in addition to a possible Plod record.As usual with rip off Britain, it's a car for tax purposes but a van for speeding fines
