Currently reading: Tax hike for pick-ups reversed by UK government
HMRC makes U-turn on changes to benefit-in-kind rules after criticism from motor industry

One week on from proposed new company car taxes for double-cab pick-up trucks, HMRC has scrapped the plans.

Company car drivers who bought or leased a double-cab pick-up truck were due to see the benefit-in-kind (BIK) payments skyrocket under proposals announced on 12 February, but in a dramatic U-turn after criticism from farmers and the motor industry, it has reversed its decision.

HMRC had announced that it would no longer consider double-cab pick-up trucks as commercial vehicles, as their second row of seats allowed them to have a dual function as a personal vehicle.

The change to company car tax BIK for double-cab pick-up trucks was due to be implemented on all new purchases or leases from 1 July 2024, and would have meant owners no longer paid a flat rate of BIK for all commercial vehicles and instead be taxed using the emissions-based system used for passenger cars.

Double-cab pick-up owners would therefore most likely have been lumbered with the highest 37% rate of BIK due to the high CO2 emissions of most pick-up trucks.

In a statement, HMRC said “its existing guidance will be withdrawn” and that double-cab pick-ups would “continue to be treated as goods vehicles rather than cars”. As a result, “businesses and individuals can continue to benefit from its historic tax treatment”.

The initial decision was due to a Court of Appeal ruling that stated multi-purpose vehicles like pick-up trucks are passenger cars, after HMRC won a case against Coca-Cola over the classification of five-seat vans.

The repercussions of that ruling had meant that the tax “loophole” allowing pick-up trucks to be classed as commercial vehicles was cast into doubt, threatening the high volume of sales for pick-up trucks in the UK.

Despite the change of heart, however, it will only affect double-cab pick-ups with a payload of more than one tonne. Double-cab pick-ups with payloads below 1000kg, like the Ford Ranger Raptor, will continue to be classed as passenger cars.

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catnip 20 February 2024

What a farce. Another measure which favours the better off in our society, there isn't an election looming is there?

Andrew1 20 February 2024
This government is a joke, most likely they took a fat donation which they do desperately need to run some stupid Facebook campaign. No interest whatsoever for the actual needs of the country.
scrap 20 February 2024

Unbelievable. This government is a joke.

Ditto farmers by the way... blocking the roads like XR but apparently a tax break on a new £50k pick up is the priority??