Taxable benefits – company car or van?

by | Sep 16, 2020

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.

Tell us about your business

Explore where you want to go, what you need to get there and how ABG can help.

ICAEW Chartered Accountants
Probate Accountants
International Accountants EAI members
BAS Approved Chartered Accountants