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Coca-Cola crew-cab van case complicates tax definitions
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Rocky road ahead for vans redefined as cars


If modified crew-cab vehicles should now be treated as cars for benefit in kind purposes, what does this mean for input VAT and capital allowances? Helen Thornley investigates the wider tax implications.

21st Aug 2020
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In the Court of Appeal case of Payne, Garbett and Coca-Cola European Partners Great Britain Ltd vs HMRC reported last week, the court determined that the three modified crew-cab vehicles that Coca Cola supplied to its employees were cars and not vans.

My earlier article explained that this case only considered the definition of a van for benefit in kind purposes, but AccountingWEB readers are right to be concerned about other areas of tax where the difference in treatment between cars and vans is significant.

Capital allowances

For capital allowance purposes, vehicles classed as vans are treated as plant and machinery, which means a van purchase is eligible for the annual investment allowance (AIA).

In contrast, the treatment of cars is more complex. The level of capital allowances depends on the vehicle’s CO2 emissions and, since cars are not eligible for the AIA, relief is given more slowly over much longer periods.

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Replies (6)

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By Paul Crowley
23rd Aug 2020 15:58

It appears that the Coca Cola case has no bearing on the treatment of double cab pickups ( or possibly Picks-up as in mothers-in -law ) provided the load cover does not invalidate the 1 tonne payload limit. ( Cannot believe that motor manufacturers would be getting that wrong. )
Based on current HMRC employment income manual.

Are there a photos of the real Coca cola vancars available? Seeing examples of these vans that are standard could be misleading. As I undersand it all vehicles were modified that were at issue. The unmodified Vivaros were not challenged and are still vans.

My sympathy goes to the real workers that had estate cars. Family just could pile in after work.
Now they have to remove and replace the seats every day morning and afternoon according to coca cola case put forward.

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the sea otter
By memyself-eye
23rd Aug 2020 10:48

A good article, clears that up for me (for now)

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By AndrewV12
24th Aug 2020 10:11

For years there has been a debate, if Land Rovers, Range rovers, modified estate cars ....... are Vans or Cars, up to now everyone has had there own definition, interpretation and utilisation of the rules.

Extract above
'Since 2002/03, HMRC has accepted that if a double cab pick-up (but no other type of dual purpose vehicle) meets the payload test to be classed as a van for VAT purposes,'

Well thank God for the above.

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By RetiredTax
31st Aug 2020 20:16

Dear Helen
Thank you for this article..
As a technical officer of ATT can you/would you (The ATT - representing Tax professionals) contact HMRC to clarify the position as to whether they will be continuing to accept that double- cab pickups are "vans" for Cap. Allc'es (& BIK) purposes or amending that "current" advice to take account of the new "thoughts" from the courts? We are in the final months of submitting 2019/20 SA comps etc and I feel we really need some certainty.
I hope you will be able bring this to a helpful conclusion.

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Replying to RetiredTax:
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By Helen Thornley
03rd Sep 2020 09:11

Yes I'm happy to raise that concern with HMRC.

Thanks (1)
Replying to Helen Thornley:
By Elgin
12th Nov 2020 20:47

Any update from HMRC regarding this?

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