HMRC 'to investigate tax status of company vans'

Date: 21st February 2011

Small businesses operators in the UK could be encouraged to seek the assistance of a specialist tax accountancy service after one industry body claimed company vans are to be investigated.

KPMG has said that HM Revenue & Customs (HMRC) is to investigate the tax status of company vans amid concerns that tax and National Insurance contributions are being underpaid, Accountancy Age reported.

The news provider explained that HMRC is said to be issuing detailed questionnaires to firms to monitor the use of company vehicles.

Employers are being asked to offer their definition of insignificant private use and provide HMRC with details of whether their vans are fitted with mileage tracker devices.

The HMRC website states: "There is a tax charge where, because of their employment, a van is made available to a director or an employee earning £8,500 a year or more, or to a member of their family or household and the van is actually used privately.
"From 2007/08, there is a further tax charge if free or subsidised fuel is provided for private use in a company van."

Posted by Emily Smith