Payload <> 1 tonne - 4motion Kombi

[WolverineMac]

@Jimmi its not the VAT that most ppl are afraid off. Its more the Benefit in Kind on the vehicle when used personally. VAT and PAYE have to different set of rules, its not uncommon to be able to claim the VAT on the purchase then have a large benefit in kind on the vehicle. The recent case was not to do with VAT but how the vehicle is classified for Benefit in Kind - If a van benefit is a flat £3,350 for use and £663 for fuel the same vehicle classified as a van, i.e a
Kombi T6 2.0BiTDI T30 Highline SWB BMT MR 204PS 4MOTION DSG with a list price of £43,458 (with no options) would have a benefit in kind of £16,079 and a fuel benefit of £8,658. That a whopping £20,724 extra per annum which would equate which would be taxable at either 20% or 40% dependent on your tax rate. Also vans are allowed insignificant personal use not to be subject to the benefit in kind where as cars are not allowed any.

 

[Jimmi]

This is the advice from a VAT consultant. Obviously bearing in mind that I’ve bought the vehicle for work use and have another car.

• If feasible and practical seek to ensure the vehicle is insured for only business purposes and does not allow / provide for any domestic use and keep the vehicle away from home (i.e. only parked/kept at business premises, unless there is a home office). This in addition to any director / company / sole proprietor note restricting the use to solely business use to employees / directors/ sole proprietor etc. would allow for full VAT recovery.

• Sometimes insurers cannot or will not provide business only restriction. If this is the case then a note from the insurers confirming that they will not provide only a business use restriction should be obtained and then it is vital to have business note / memorandum etc stating the vehicle must only be used for business purposes and no commuting home etc., even to just the sole proprietor – again if feasible in the circumstances. HMRC may challenge this, but we have worked on a few of these and HMRC have accepted the position. It is important to note that the car can only be kept or parked at home if there is a home office or on minor occasions for picking up any business deliveries sent to home for security or safety reasons as opposed to the office.

 

[WolverineMac]

We also ask our clients to keep a mileage log for the business trips and ensure this ties up with the mileage on the vehicle.

 

[carlg]

Reading up on the one ton rule ,and it dose say only applies to double cab pickups .
But then I found this
Some vehicles look like vans and don’t have windows in the sides behind the driver. But they do have additional seats for carrying passengers behind the front row of seats (or they’re designed so they can be fitted with them). They’re sometimes known as combination vans or combi-vans. HMRC considers that this type of vehicle is a commercial vehicle for VAT purposes if it meets either of the following conditions:

1. It has a payload of more than one tonne after the extra seats have been added.
2. The dedicated load area (the load area that’s completely unaffected by the extra seats) is larger than the passenger area.

If it meets either of these conditions, then the vehicle is a commercial vehicle for VAT purposes and you can reclaim the input VAT if you follow the normal rules for reclaiming VAT.

The 4 motion kombi cant carry a ton ,but the load area is bigger than the passenger area .

 

[Jimmi]

The Kombi has windows behind the driver so it doesn’t qualify as a van

 

[carlg]

The Kombi has windows behind the driver so it doesn’t qualify as a van

Bugger missed that part .looks like I will be keeping mine ,or a £7000 vat gamble

 

[Jimmi]

Bugger missed that part .looks like I will be keeping mine ,or a £7000 vat gamble

If you can justify owning the vehicle for work just follow the instructions from the VAT consultant that I posted.

 

[Motohawk]

Hi sorry to bring this all up again
Can anyone clarify if this effects sole traders ? I ask as I don’t think that someone who’s self employed / sole trader has to pay bik tax on a vehicle / van that they claim for work ..... ?
so if you are a sole trader and vat registered can you choose a kombi and use the premise that it has a 1 ton payload and you need the extra seating (motorcycle shop so used for collecting bikes and there rider / pasenger in the event of a breakdown ) ?
Vat would be fine surely you claim ?
If you work from home and your business is registered there then surely you can keep the vehicle at that address ?
and if so did claim 100% tax relief on it and they looked into it and decided that they infact did not agree and ruled it as a car would you be liable to pay back the vat as well as the tax claimed on it ?

 

[Insert Coin]

Hi sorry to bring this all up again
Can anyone clarify if this effects sole traders ? I ask as I don’t think that someone who’s self employed / sole trader has to pay bik tax on a vehicle / van that they claim for work ..... ?
so if you are a sole trader and vat registered can you choose a kombi and use the premise that it has a 1 ton payload and you need the extra seating (motorcycle shop so used for collecting bikes and there rider / pasenger in the event of a breakdown ) ?
Vat would be fine surely you claim ?
If you work from home and your business is registered there then surely you can keep the vehicle at that address ?
and if so did claim 100% tax relief on it and they looked into it and decided that they infact did not agree and ruled it as a car would you be liable to pay back the vat as well as the tax claimed on it ?

I’d ask your accountant to clarify in writing for you.