If you drive a double cab pick-up for work or personal use, you need to know about a big tax change coming in April 2025. The way these vehicles are taxed is shifting, and it could hit your wallet harder than expected.
Let’s get straight to it – no messing about.
What’s changing?
Right now, most double cab pick-ups with a payload of at least one tonne are classed as vans for tax purposes. That means they benefit from a lower, fixed-rate benefit-in-kind (BIK) charge for company vehicle tax. But, from 6 April 2025, HMRC will treat them as cars instead.
Why the change? HMRC reckons these vehicles are just as much about carrying people as they are about carrying goods, so they’re shifting the classification. That decision means higher tax bills for businesses and employees who use these vehicles.
How much more tax will you pay?
The tax impact depends on whether you use the vehicle personally and how much CO₂ it pumps out. Here’s what changes:
- BIK tax: Instead of a flat rate, the tax will now be based on the vehicle’s list price and CO₂ emissions. Since many double cab pick-ups aren’t exactly low-emission, expect to pay more.
- Employer’s National Insurance contributions (NICs): This will also increase because they’re linked to the taxable BIK value.
- VAT and capital allowances: If you run a business, check how this change affects VAT reclaims and capital allowances on double cab pick-ups.
For company drivers, the increase could be thousands of pounds per year – a hefty jump from the current van-rate tax treatment.
Any loopholes or workarounds?
Not really, but there is a transition period if you’ve already got a double cab pick-up before the April 2025 deadline. HMRC says the current van tax rules will still apply until you sell or dispose of the vehicle, the lease ends, or April 2029 – whichever comes first. So, if you’re thinking about getting one, you might want to act fast.
What should you do now?
- Check your current vehicle status: If you already have a double-cab pick-up, you might be able to continue using it under the existing tax rules for a few more years.
- Reassess your vehicle needs: If tax efficiency matters, you might want to consider alternatives, such as fully electric vans or lower-emission vehicles.
- Plan your purchases: Are you thinking about upgrading or getting a new pickup? Doing it before April 2025 means you’ll benefit from the old rules for a while longer.
- Talk to an accountant: If you’re unsure how this will hit your business or personal tax bill, now’s the time to get advice. Feel free to reach out to us today.
Final thoughts
This change is a blow for tradespeople, businesses, and company drivers who rely on double cab pick-ups. If you’re affected, you’ve got time to prepare – but waiting too long could cost you.
At For the Trade, we’re keeping a close eye on this and can help you understand what it means for your business.
If you need a hand figuring out the best move, give us a shout – we’ll sort you out with straight-up advice on the new double cab pick-up tax rules, no faff.