Shropshire business owners could face unexpected tax bills due to a major rule change affecting double cab pick-up vehicles, set to take effect on April 6.

DY Associate, Sarah Crane, explained that a double cab pick-up is a truck with two rows of seating in the front and an open load area behind.

“Many businesses – especially those in farming and agriculture – rely on these vehicles daily,” said Sarah. “But from April 6, new tax rules could significantly change the cost implications of owning one.”

Under the changes, double cab pick-ups will no longer be classified as vans for Benefits in Kind or Capital Allowance purposes.

“They will now be treated as cars, which means higher tax bills for both businesses and employees,” Sarah said. “Employees using these vehicles for personal use will face increased Benefit in Kind taxes, while businesses will have reduced Capital Allowances, making it harder to claim tax relief.”

However, Sarah highlighted an important exception:

“These changes only apply to vehicles purchased or leased on or after April 6. If you buy, lease, or order a double cab pick-up before April 5, the current tax rules will still apply – until you dispose of the vehicle, the lease expires, or you reach the cut-off date of April 5, 2029, whichever comes first.”

Sarah advised business owners to carefully consider their options before making any decisions.

“There are steps you could take to minimise the financial impact of the changes, but it’s important to weigh up the best course of action.

“You may want to purchase or lease a double cab pick-up before the April 5 deadline to take advantage of the current tax rules. However, it’s also worth considering whether vehicle values may change after the rule comes into effect, as waiting could potentially result in cost savings.

“You should also review alternative vehicle options, such as single cab pick-ups or other commercial vehicles, and assess whether limiting private use of affected vehicles within your business could help manage costs.

“If you think you may be affected, it’s crucial to seek professional advice as soon as possible to assess your options and make an informed decision,” Sarah added.

Notably, the VAT rules on double cab pick-ups with a payload of at least one metric tonne will remain unchanged.

Get in touch with Dyke Yaxley for advice.