When it comes to taxable benefit there is a significant difference between an employee having access to the private use of a company van as opposed to a company car and this was recently demonstrated in the Coca-Cola case.
The Upper Tribunal has ruled that “of a construction” means an employer must look at the vehicle in the state in which it was provided to the employee and this must include any post-factory modifications. In short, the difficulties arise when the vehicle has a second row of seats.
The Court of Appeal has now ruled in the case of Coca-Cola that if the vehicle is equally able to carry either goods or people, it fails the van test and therefore it must be treated as a car for taxable benefit purposes.
This judgement is binding and therefore employers should follow it when submitting forms P11D for 2020/21 and later years.
In light of this ruling, we are currently advising our clients to review how their combi-vans have been reported on P11Ds for earlier years.
If you wish to speak to a member of our team regarding taxable benefits, company cars or vans or adjustments to P11ds please contact us on 020 7330 0000.
Further information on HMRC’s car v van guidance can be found here. https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim23110
