No Logo

[buntings]

Hi,

I run a company van - simply as it was a tax efficient way of getting a new vehicle and I dont need a car. The tax on the benefit in kind is far cheaper than running it privately, the initial cost and depreciation is allowed against CT, all running & servicing costs are paid by the company ( and the vat is of course reclaimable - which even makes the diesel quite cheap). Even the road tax is less as its classed as a commercial vehicle. It is very tax efficient for me and for my ltd.

However - there are things to be aware of...

1) Not all vans are allowable and you need to read the HRMC guidance. It seems not all vans are vans in the eyes of HMRC.

2) Normal car insurance policies dont apply to vans, you will need to get van insurance. In my case this wasnt much different to my car insurance cost - however I had to transfer my no claims bonus to the commercial van policy and as far as I know it cant be transfered back to a private policy. Also, my commercial policy doesnt allow me to drive another vehicle third party like a normal personal insurance.

Oh - and putting a logo on the vehicle ( which isnt a HMRC requirement ) adds to the insurance cost.

3) Break down insurance - my van just reached 3yrs old and the warranty expired. Again, normal breakdown insurance basically excludes commercial use and also specifies that the vehicle has to be privately owned.

I got around all of the above but it has caused some hassle along the way - bit of a mine field but the savings were worth the extra work.

Hope that helps.

[mekondelta]

Van types

..snip...
However - there are things to be aware of...

1) Not all vans are allowable and you need to read the HRMC guidance. It seems not all vans are vans in the eyes of HMRC.

...snip...

Buntings, I can't find any guidance on the HMRC web site about the type of van allowed. Is a Fiesta van allowed?

[Tarquin Farquhar]

http://www.hmrc.gov.uk/vans/index.htm

Tax on : £3000 benefit for private use of Van + £500 benefit for private fuel

That's right:

Company van with NO PERSONAL USE WHATEVER: No taxable benefit.
Company van used ONCE in the year for personal purposes: tax on £3k benefit.

That's the consequence of "occasional" personal use.

How to persuade HMRC that there is no personal use? Have your own car, and log all business use on the business vehicle.

[Sally BFCA]

It may be more advantages to lease the van and claim 100% back on tax.

If you purchase an electric van, you can claim 100% allowance against tax in the first year as announced in the Pre-Budget Report 2009

[buntings]

Buntings, I can't find any guidance on the HMRC web site about the type of van allowed. Is a Fiesta van allowed?

I thought I'd seen a listing of vehicles - but it was over three years ago when I bought my van. Best I can find is this link :-

http://www.hmrc.gov.uk/manuals/eimanual/EIM22700.htm

from which there are various bits of information to wade through. I think it comes down to whether the vehicle can be used as a private car - ie seat more than two passengers, has rear seats and/or rear doors ( so dont buy a "crew cab" ). I have a freelander commercial - a purpose made van, no rear doors and only two front seats with a mesh divider between the front and back. No rear windows etc.

I would have thought a fiesta van would be ok assuming it was purpose built as a van, has only two seats etc.


Hope that helps.