Capital Allowances on Converted Van

Didn't find your answer?

I have a client who runs his taxi business through a limited company. He's looking at purchasing a Ford Transit van (medium wheelbase, semi high top) and converting it into a disabled access taxi with fewer than 9 passenger seats. The van is capable of having more than 9 passenger seats but will have fewer to accommodate at least 1 wheelchair user. I understand that being disabled access does not, on its own, qualify it for the AIA and the driver will not need a special licence to operate it. 

CA23510 describes a car as being "a mechanically propelled vehicle other than a vehicle of a type which is not commonly used as a private vehicle and is not suitable for use as a private vehicle". 

I feel there's a decent case to argue it's not suitable for private use, you wouldn't expect to find it in the show room of a dealership selling private vehicles, whereas you would expect to find it in a dealership show room selling commercial vehicles. Besides the vehicle itself is capable of carrying more than 9 passengers, the only reason it has fewer is to grant access to wheelchair users.

Our tax specialists viewed it as being a car for CA purposes so I'm wondering if I'm trying too hard to see it from our client's point points of view. Any thoughts would be welcomed. 

Thank you. 

 

 

Replies (4)

Please login or register to join the discussion.

avatar
By David Ex
22nd Nov 2022 11:16

Vaguely similar question here:

https://www.accountingweb.co.uk/any-answers/how-do-i-treat-changing-van-...

Are there not two issues? One buying a van (not a car) and then the costs of conversion.

EDIT: Think that’s what the earlier question says, having skim read.

Not the question but surprised it’s worth going down this route rather than buying a converted vehicle. There are plenty of suppliers.

Thanks (0)
avatar
By colinmullins
22nd Nov 2022 11:45

Thanks for the reply. He also runs a garage and believes he can do it cheaper this way. He plans to convert it immediately after purchase, my understanding is that we would need to treat it in its post-conversion form?

Thanks (0)
Replying to colinmullins:
avatar
By David Ex
22nd Nov 2022 12:01

colinmullins wrote:

He also runs a garage and believes he can do it cheaper this way.

I’m sure it can be done cheaper but there must be lots of safety regulations about vehicle conversions generally and for passenger carrying vehicles specifically.

colinmullins wrote:

He plans to convert it immediately after purchase, my understanding is that we would need to treat it in its post-conversion form?

Short answer is, I don’t know. My (naive, probably) first reaction would be that the tax is based on what was acquired - which is a van.

Another few related threads:

https://www.accountingweb.co.uk/any-answers/when-is-a-van-not-a-van-1

https://www.accountingweb.co.uk/any-answers/van-or-car-new-land-rover-di...

https://www.accountingweb.co.uk/any-answers/when-is-a-van-not-a-van-0

And this, if you have a subscription:

https://www.taxation.co.uk/articles/2010-01-06-19790-van-uncovered

Thanks (1)
Replying to David Ex:
avatar
By colinmullins
22nd Nov 2022 12:26

Thanks David, appreciate your input on this. The safety regulations issue is a very good point and one that I'll let him worry about!

I guess the question would be the same if he purchased a 12-14 seater minibus and removed a few seats to accommodate wheelchair access. He may end up doing this.

I'm still learning my trade and was worried that I'd missed something obvious here. The more I look at it, the more I think it's a bit of a stretch to claim the AIA.

Thanks (0)