The advice from your friends is actually pretty sensible. Vans have a number of advantages for tax purposes:
- More relaxed rules with regards to avoiding benefit in kind charges
- Lower benefit in kind charges- both for the provision of the vehicle and fuel
- Any input VAT suffered on its purchase can usually be reclaimed
- Vans should qualify for the Annual Investment Allowance for Capital Allowances purposes
Defining a van can be tricky, as there are different criteria for different areas of tax, but try to stick to the following conditions:
- A vehicle that is not commonly used as a private vehicle and is unsuitable for such use
- A vehicle primarily suited for the transportation of goods- no rear seats/ windows,
- Has a maximum legal laden weight of 3,500kg
Discussing this with an accountant before you make any purchases, could prevent you from losing tax relief and being unable to reclaim VAT. So if you would like to discuss your vehicle purchases in more depth, please feel free to contact your local TaxAssist Accountant.
By Jo Nockels
Disclaimer: The information provided is based on current guidance (at date of publication) from HMRC and may be subject to change. Any advice shared here is intended to inform rather than advise. Taxpayer's circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this information, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.