Imminent pick-up truck tax hikes are ‘rash’ but buyers have a month to dodge them

Buyers of double-cab pick-up trucks who pay company car tax or claim capital allowances have one month to order new vehicles before new HMRC tax rules are introduced on 6 April.

Double-cabs are currently assessed as commercial vehicles for company car benefit-in-kind, meaning users have a flat-rate annual BiK liability of £3,950. From April this year, however, they’ll be considered as passenger cars, and subject to CO2 emissions-based BiK rates that could be as high as 37 per cent. 

Capital allowances will also be cut for business users, who will in future be able to offset much less of a double-cab’s purchase cost against tax. 

The changes follow a court ruling that double-cabs are equally suited to carrying goods or people, and therefore can’t demonstrate the required ‘predominant suitability’ for goods required for classification as commercial vehicles.

What are car manufacturers saying?

Car makers have hit out at the changes, suggesting the added costs will hit small businesses hard at a time when the Government says it is focused on a growth agenda. 

“The change in taxation to double-cab pick-up vehicles for benefit-in-kind and capital allowance purposes is a rash move by the Government that will have a big impact on UK business,” a Ford spokesperson told Auto Express. Ford considers the Ranger double-cab to be a true work truck, with businesses relying on its capability and versatility to carry heavy loads and to tow.

“Double-cab pick-up trucks are an essential tool for the farming and agricultural sector, construction, transport and for small business owners such as landscape gardeners, who rely on the additional space provided not only for passengers but additional stowage, which will now carry a significant premium for many,” according to Ford. 

The company sold 20,000 Rangers in the UK last year, and estimates that at least two-thirds of customers will be hit by the tax hike. “If the Government will not reconsider its decision to implement these changes to taxation, it should – at a minimum – consider a deferral to April 2026, allowing those affected time to prepare and adjust appropriately,” the spokesperson told us.

A spokesman for Musso importer KGM Motors echoed those views: “We, along with the wider industry and users of double-cab pick-ups, feel the HMRC’s logic is wrong and out of date. 

“The majority of double-cab pick-up buyers have a specific need for the vehicle, and its dual purpose negates the need to run two vehicles, a car and a van,” the firm told us. “The historic view that double-cab pick-ups are a tax dodge is incorrect. If these people are avoiding a passenger car BIK, then they would choose an EV, which is lower BIK than a commercial vehicle.”

Isuzu, which has less of a ‘lifestyle’ focus than some rivals in the sector, told us that the majority of its customers are likely to be unaffected by the BiK change, but agrees that capital allowance changes will impact business owners.

The firm also pointed to its plan “to introduce the first fully capable BEV pick-up to the UK in 2026”. Launched at the Bangkok Motor Show in March last year, the zero-emission vehicle promises to retain a one-tonne payload and 3.5-tonne towing capacity, but will mean reduced BiK compared with ICE pick-ups.

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