Many UK businesses use double cab pick-ups for work, with some private use allowed. Until recently, these vehicles often sat in a helpful “van” tax position. That changed from 6 April 2025. HMRC now expects most double cab pick-ups to fall under company car rules for direct tax, which can push up both employee tax and employer costs. This guide explains van tax changes, who gets hit, and what practical steps to take.
From 6 April 2025, HMRC stopped aligning the “car vs van” position for double-cab pick-ups with the VAT payload approach. Instead, HMRC applies a “primary suitability” test for employment tax. HMRC’s view is that most double cab pick-ups can carry people and goods with no clear dominant goods purpose, so they will usually count like cars for benefit-in-kind (BIK).
Van BIK uses a flat-rate charge. For 2026/27, the van benefit charge is £4,170 and the van fuel benefit charge is £798.That means the employee’s tax cost on the van benefit can look like this:
Car BIK uses the list price × a CO₂-based percentage. The percentage can be high on many diesel pick-ups, so the taxable benefit can jump fast.
Here is a straightforward example (not a quote, but rather the standard calculation method):
That is why many firms see costs “double” or more when the classification flips.
With a car, private availability can trigger a taxable benefit. For vans, the tax treatment depends on whether the restricted private use conditions are met. GOV.UK provides specific guidance on when company cars and vans available for private use create a benefit charge.
So a move into car rules can create a tax charge where there was none.
Employers generally pay Class 1A National Insurance on taxable vehicle benefits. For 2026/27, the Class 1A NIC rate is 15%, so a higher taxable BIK can also increase the employer’s National Insurance cost.
For capital allowances, HMRC changed its approach for expenditure incurred:
Most double-cab pick-ups will fall under car tax rules, which can restrict fast, upfront relief compared with a vehicle treated like plant and machinery.
For leased vehicles, the car leasing restriction can apply where CO₂ emissions exceed 50 g/km, generally restricting 15% of qualifying rental costs. Transitional treatment was also applied to certain double cab pick-up contracts entered into before the April 2025 changes where expenditure was incurred before 1 October 2025.
HMRC states the VAT input tax position remains unchanged. So VAT treatment does not automatically follow the new direct tax position.
This is the first thing to check.
If you purchased, leased, or ordered a double cab pick-up before 6 April 2025, you can usually keep the earlier “van” treatment until the earlier of:
For capital allowances, transitional rules can apply where the contract was entered into before the relevant April 2025 date and expenditure is incurred before 1 October 2025.
Create a list of every affected vehicle:
This quickly shows which vehicles sit inside transitional protection.
If you want a van outcome for any vehicle that still qualifies:
Do not guess. Cost it out per vehicle:
Businesses can also use our payroll services including company vehicle Benefit-in-Kind reporting to help manage payroll calculations and vehicle benefit reporting accurately.
Depending on your operations, options may include:
Apex Accountants supports businesses that provide company vehicles to staff, including trades, construction, rural firms, logistics teams, and service companies.
Our services typically cover:
HMRC expects that most double cab pick-ups will be taxed like cars due to the “primary suitability” test. Some exceptions may exist, but you need a facts-first review.
Often, you will have protection until the earlier of the disposal, the end of the lease, or 5 April 2029, provided you meet the conditions.
HMRC says VAT treatment remains on its own rules. Direct tax changes do not automatically rewrite VAT treatment.
The van benefit charge for 2026/27 is £4,170, while the van fuel benefit charge is £798. Eligible zero-emission vans continue to have a van benefit charge of £0.
These “van tax” changes are a classification shift. For many double-cab pick-ups, HMRC now applies company car tax rules. Such changes can increase BIK, limit tax relief, and raise employer costs.
Start with the key dates. Determine whether transitional protection applies. Then run the numbers for each vehicle before making renewal decisions.
If you are unsure how the changes affect your business or fleet, speak to Apex Accountants. We can review your vehicles, assess the tax impact, and help you plan the next steps with confidence.
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