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CarMan

Member Since: 29 Nov 2010
Location: Cotswolds
Posts: 1858

I think this issue has been comprehensively covered elsewhere and I know many treat USW's as vans, but being of a cautious nature I decided not to purchase on the basis of the following from HMRC's own own manual, but note I am not qualified to offer advice! Please see the section in bold in particular.

EIM23110 - Car benefit: car or van - summary
Section 115(1) ITEPA 2003
This page is designed to be issued to taxpayers wanting guidance on the difference between cars and vans for tax purposes.

In deciding whether or not a particular vehicle counts as a car for car benefits purposes, the starting point is the definition in Section 115(1) Income Tax (Earnings and Pensions) Act 2003 (ITEPA). This works by exception: every mechanically propelled road vehicle is a “car” unless it is:

(i) a goods vehicle (a vehicle of a construction primarily suited for the conveyance of goods or burden of any description)
(ii) a motor cycle (as defined in Section 185 Road Traffic Act 1988)
(iii) an invalid carriage (also as defined in that Act)
or (iv) a vehicle of a type not commonly used as a private vehicle and unsuitable to be so used
Exceptions (2) and (3)
It is normally obvious whether either applies.

Exception (4)
This exception can also be discounted in most cases. Irrespective of their use in practice, there is nothing that renders most vehicles inherently unsuitable for private use. Indeed the marketing of many whose status might otherwise be uncertain is aimed at illustrating how well fitted they are for private use.

It follows that, if a vehicle is to escape from being classified as a car, it will normally need to satisfy the first of the tests in Section 115(1).

Exception (1)
This looks at the construction of a vehicle to see if it is primarily suited for the conveyance of goods or burden (note that ‘primarily’ is crucial and that ‘goods or burden’ does not include people). This means we must look to see if there is a predominant purpose of construction.

Actual use of a particular vehicle is irrelevant: the statutory test is a test of construction, not use.

The fact that the manufacturer or dealer describes the vehicle as a “commercial vehicle” is not conclusive.

If a vehicle is designed and marketed as a multi-purpose vehicle, it is unlikely to fall within this exception.

Even if the preceding 2 paragraphs do not apply but neither purpose predominates with regard to the construction of the vehicle, the vehicle is not primarily suited for either purpose and this means that it does not escape from being a car. Clearly if its primary purpose is to carry passengers it will also remain within the company car legislation (unless it is so big that it is clearly a bus). It is only if the primary purpose for which the vehicle is constructed is the carriage of goods that it will escape from being a car.

If a vehicle has side windows behind the driver and passenger doors, it is also unlikely to fall within this exception. This is particularly so if it is fitted, or is capable of being fitted, with additional seating behind the row which includes the driver. This remains true whether or not those additional seats are in the vehicle at the time.

There is guidance on the specific type of vehicle known as double cab pick-ups at EIM23150, on other off-road vehicles at EIM23145 and on other specific types of vehicle at EIM23155.

Where a vehicle does escape being a car because exception 1 applies, the van benefit rules of Section 154 ITEPA will normally apply (EIM22700 for 2005/06 onwards). Otherwise, unless the specific rules for heavy goods vehicles prevent a charge (EIM22990), the residual benefit rules of Section 201 ITEPA onwards will apply (EIM20000). Rob

1993 200tdi 90 hard-top
1998 300tdi 90 soft-top
2016 2.2 XS 90 hard-top (sold)

11th Apr 2024 3:23pm

lightning

Member Since: 23 Apr 2009
Location: High Peak, Derbyshire
Posts: 2735

Revisiting this thread as l am looking at a 2012 Defender Commercial.

Could it be argued that the Defender Commercial is "primarily designed to carry goods" as it was never designed to be a car.
lt's effectively a Double Cab. You couldn't fit the back row seats and there's no windows in the load area.

How many people do you know, who use a Defender Utility primarily as a car.

What's the law on (say) a VW Transporter van fitted with side doors and removable seats behind the driver?

l realise HMRC are trying to close what are effectively loopholes but l doubt there's many people using old Defender USW's solely as cars

16th Nov 2024 5:19pm

lightning

Member Since: 23 Apr 2009
Location: High Peak, Derbyshire
Posts: 2735

Such a grey area.

ln this thread from 2014 someone received an "official document from Land Rover" stating that the USW is a Commercial Vehicle for BIK and VAT purposes.

https://www.landyzone.co.uk/land-rover/ben...ty.256685/

16th Nov 2024 5:34pm

blackwolf

Member Since: 03 Nov 2009
Location: South West England
Posts: 17353

2007 Defender 110 Puma 2.4 DCPU Stornoway Grey

I would be very careful in making any assumptions, especially since the new Government took office.

The Chancellor has already stated that she intends to close the "loophole" that allows double-cab pickups to be classed as commercial vehicles for BIK assessment, and since the majority of Ford Rangers and similar vehicles are sold simply to exploit this loophole it is easy to see why.

If a double-cab pickup is no longer to be classed as a commercial for BIK, I cannot imagine that what is in effect a double-cab pickup with a continuous roof will be classed as commercial either. It is, after all, less commercial-oriented than one with an open buck.

The time cannot be far off when the only commercial Defenders, at least for BIK etc assessment, will be those with only front seats and either a full hardtop or a truck cab.

Fortunately for those of use who operate such vehicles entirely privately and not as a tax avoidance ploy they remain classed as dual purpose vehicles for C&U purposes and therefore enjoy commercial rates of VED.

I don't think a document from Land-Rover stating that the USW is a Commercial Vehicle for BIK and VAT purposes is worth the paper it is printed on, it is not a matter for Land-Rover. It is solely a matter for the treasury and HMRC, and HMRC can and does change the rules and definitions as it and the treasury wishes. Last year's definitions may well not be the same as this years.

HMRC is also a dangerous body to challenge, since they have powers of investigation, entry, and redress second to no other body in the UK. As far as I know HMRC is still the only authority which can enter your home and search it without so much as a search warrant.

Last edited by blackwolf on 16th Nov 2024 10:38pm. Edited 1 time in total

16th Nov 2024 5:51pm

lightning

Member Since: 23 Apr 2009
Location: High Peak, Derbyshire
Posts: 2735

Fair points.

lf HMRC were to check up they would find that my vehicle is not a tax dodge but is used almost entirely for genuine business purposes.
lf it wasn't for towing the caravan a few times a year l could genuinely claim zero BIK.

However l imagine that would not make any difference in whether they accepted a Defender USW as a Commercial Vehicle in my accounts.

l guess l will have to stay with my 2022 Defender Commercial which is definitely a Commercial Vehicle.

lt's a shame because this Puma 110 Commercial for sale locally is in beautiful condition. l viewed it before the dealer had done anything with it, so it hadn't even been cleaned. lt's the first one l've seen with unmarked original factory paint on the crossmember.

Not that l don't love the new Defender, it's an awesome vehicle. But the repair costs once out of warranty concern me.

For instance
Last week it had a service and it involved replacing the brake fluid. To do this you have to put the system into "service mode"

They couldn't reset the system and spent 4 1/2 hours trying to do it. Eventually it seemed okay but on the way home the ABS light came on, along with a "2wd only" message

Fortunately l was able to reset it with my GAP tool and it's okay now. But it didn't fill me with confidence.

16th Nov 2024 10:21pm

blackwolf

Member Since: 03 Nov 2009
Location: South West England
Posts: 17353

Not many classic Defenders left the factory with unmarked factory paint on the cross-member so that is a rare thing indeed!

I fully understand your concerns about maintenance costs and reliability with the new Defender, similar concerns are making me think hard about whether a Grenadier is sensible or not.

16th Nov 2024 10:40pm

lightning

Member Since: 23 Apr 2009
Location: High Peak, Derbyshire
Posts: 2735

As far as depreciation goes there's not much in it. An expensive Puma Defender would depreciate as much as my new Defender over time, if l did 8-10,000 miles a year in it.

Although eventually the Puma will likely retain more value than the new one, which may well be worthless after 15-20 years.

17th Nov 2024 6:03pm

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