Saffery has welcomed the U turn by Government on the tax treatment of double cab pick-ups (DCPUs), just a week after proposed changes were announced that such vehicles with a payload of one tonne or more would almost always be treated as cars for tax purposes, particularly for calculation of benefit in kind charges and capital allowances.
On 12 February, HMRC had updated its Employment Income and Capital Allowances manuals to explain that, from 1 July 2024, most, if not all, double cab pick-ups would be treated as cars for tax purposes. That updated guidance stated that: “this is because typically these vehicles are equally suited to convey passengers and goods and have no predominant suitability.”
Martyn Dobinson, Partner, Saffery, and a member of the firm’s Land and Rural Practice Group, said: “This u-turn is a welcome move. For many farm and estate businesses these vehicles are workhorses of the business, and it is a relief that they will continue to be treated for tax purposes as goods vehicles rather than cars. It’s good that Government has listened to the farming sector and made this swift change of direction.”
The subsequent Government announcement on 19 February stated: “DCPUs will continue to be treated as goods vehicles rather than cars, and businesses and individuals can continue to benefit from its historic tax treatment,” and that after consideration and listening to the views of farmers and the motoring industry, the change would not have been “consistent with the Government’s wider aims to support businesses, including vital motoring and farming industries.”
