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In the Autumn Budget of October 2024, it was announced that new VED changes would be coming into force, some of which affect the classification of vehicle types and, therefore, the tax rates. Consequently, businesses and drivers alike will face new costs. In this latest article, Johnsons explain the full details of the changes, and what you can do to beat them!
From 1 April 2025, tax treatment for double cab pick-up trucks are undergoing a big change. Double cab pick-ups with a payload capacity of one tonne or more will be reclassified as passenger cars. Businesses who use double cab pick-ups benefited from the Benefit-in-Kind (BIK) taxation plus business profit deductions, with the change of classification; these vehicles will no longer get the benefits of tax treatment that’s assigned to light commercial vehicles.
Key dates you need to be aware of
1 April 2025 – Double cab pick-ups will be treated as passenger cars – this will affect Corporation Tax.
6 April 2025 – Double cab pick-ups will have the same classification as BIK and profit deductions – this will affect income tax.
What if I already own a double cab pick-up truck?
Existing capital allowances treatment will apply to owners who purchased a double cab pick-up truck before April 2025. Anyone who purchases a reclassified model will pay the same tax rate as a passenger car.
What is the impact on capital allowances and business deductions?
Businesses can still claim capital allowances on double cab pick-ups if they purchased them before April 2025. The new rules for passenger vehicles will now apply to these trucks, reducing the tax benefits that were previously available under the commercial vehicle classification.
Government arrangements for the transition
If businesses have purchased, leased or ordered a double cab pick-up before April 2025, then HMRC have introduced some transitional rules to help. You can continue using the old tax treatment until one of the following happens (whichever comes first):
This gives businesses time to adjust to the new tax classification.
Get your hands on the Ford Ranger at Johnsons Ford Tamworth and Sutton Coldfield
Models such as the Ford Ranger, one of the exemplary vehicles we offer here at Johnsons, will be subject to this change. Make sure you head down to Johnsons Ford in Sutton Coldfield and Tamworth to experience these exciting models for yourself – but you need to be quick! Purchase and register yours before April 2025 to continue enjoying the tax benefits.
Explore our existing offers on these brilliant models by clicking the link below.
Beat the tax change!
Whether you’re a business owner or individual and already own or are looking to purchase a double cab pick-up, these changes will affect your taxation and finances greatly. Plus, planning vehicle investments or leases with these changes will help businesses make informed decisions that best suit their finances.
If you have any more questions about the tax changes, please don’t hesitate to get in contact with the Johnsons team who will happily assist you in any way they can.
Whatever your question or feedback we are here to help. So please feel free to contact us.
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Johnsons Cars Limited is an appointed representative of ITC Compliance Limited which is authorised and regulated by the Financial Conduct Authority (their registration number is 313486) and which is permitted to advise on and arrange general insurance contracts. Johnsons Cars LTD is authorised and regulated by the Financial Conduct Authority for consumer credit activity and our registration number is 688450. Registered Name: Johnsons Cars Ltd. Registered Office: Empire Court, Albert Street Redditch Worcestershire B97 4DA. Registration No. 3716766 VAT Registration No. GB927551606
As an FCA regulated credit broker we can introduce you to a selected group of lenders / brokers (see below) who may be able to help you finance your purchase. This group of lenders / brokers provides us with a range of products which may be suitable for your purchase. We will explain the key features of those products to you.
Volkswagen Financial Services (UK) Limited, Evolution Funding Limited, Santander Consumer (UK) plc, Honda Finance Europe PLC, CA Auto Finance UK Ltd, Suzuki Financial Services Limited, Volkswagen Financial Services (UK) Limited, Hyundai Capital UK Limited, Stellantis Financial Services Uk Limited, Mazda Financial Services (UK) PLC, FCE Bank Plc, We are a credit broker and not a lender. We can introduce you to a limited number of lenders and their finance products, we act as their agent for this introduction. We are not an independent financial advisor; we will provide details of products available. We may advise you on the products, subject to your personal circumstances, though you are not obliged to take our advice or recommendation.
We do not charge you a fee for our services. we will typically receive commission from whichever lender we introduce you to (either a fixed fee or a fixed percentage of the amount you borrow).
Unless we consider it to be inappropriate given your personal circumstances, for certain vehicles e.g. New, our approach is to introduce you to the lender who are usually able to offer the best available package for you, taking into account interest rates, residual valuations (where applicable) and other contributions. If they are unable to make you an offer of finance, or the vehicle is not one that we would normally place with them we will introduce you to other lenders on our panel. The lender we introduce you to and available rates will depend upon a number of factors including: the vehicle, your personal circumstances and the likelihood of a lender to accept an application based on information provided.
Lenders typically pay a commission to us for introducing you to them, calculated by reference to the vehicle model or amount you borrow. Different lenders may pay different commissions for such introductions; some lenders may also provide preferential rates to us for the funding of our vehicle stock and also provide financial support for our training and marketing. But any such amounts they and other lenders pay us will not affect the amounts you pay under your finance agreement, all of which are set by the lender concerned. If you would like to know the amount of any remuneration we have received from the finance provider, please ask us.
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