The Autumn Budget is likely to prompt widespread rewriting of company car choice lists to tackle new issues around double cab pickups.
From 1 April 2025 for corporation tax, and 6 April 2025 for income tax, DCPUs will be treated as cars for the purposes of capital allowances, Benefits in Kind, and some deductions from business profits.
The existing capital allowances treatment will apply to those who purchase DCPUs before April 2025.
“Transitional” Benefit-in-Kind arrangements will apply for employers that have purchased, leased, or ordered a DCPU before 6 April 2025. They will be able to use the previous treatment, until the earlier of disposal, lease expiry, or 5 April 2029.
The changes are likely to result in big BiK charges for drivers, and Class 1A NICs for businesses, along with less beneficial capital allowances for applicable vehicles.
The change follows a 2020 Court of Appeal ruling that most multi-purpose vehicles, such as double cab pickups, are cars in the case of Payne & Ors (Coca-Cola) v R & C Commrs.
The Association of Fleet Professionals (AFP) said the moves made by the Chancellor mean that the viability of double cabs will now be placed under serious questioning by many fleets.
Paul Hollick, chair at the AFP, said: “Anyone still in a double cab after April 2029 is going to see an exponential increase in their tax. It’s possible that these vehicles will almost disappear from car fleets, although there is arguably some clarification needed if they are used strictly for work purposes only and taken home at night.”
