A Guide to Van Tax
Taxing your van: know what you need - or don't need - to pay up
There's no getting around it, put the words van and tax together and you've got a subject matter that can send even the greatest motoring enthusiast
to sleep. But if you own or drive a van it's in your best interest to keep your eyes wide open and set a couple of minutes aside to get to grips with the
topic. The good news is it's not as complicated as you'd thinkâ€¦
Back to basics
For tax purposes a company van is built with the intention of carrying goods and loads which has a â€˜design weight' of up to 3,500 kilos and is
provided by an employer. As for the tax charge, van drivers typically pay less than their fellow car users and if they fall within a certain criteria, it's even
possible to pay nothing at all. Since 6 April 2005, some employees no longer have to pay tax on their company van unless it's used for journeys other
than between home and work.
However, the current tax charge for employees who use a company van for private use is Â£3,000. There's also an additional Â£500 tax charge if free
or subsidised fuel is provided for private use in a company van. Sounds awful, doesn't it? But that charge reduces to nil if the employees drive the van
mainly for business travel, and any private use, other than for journeys to and from work, is insignificant.
To make matters a little messy, the word â€˜insignificant' is not clearly defined, but HM Revenue & Customs say taking an old mattress or other
rubbish to the tip once or twice a year is fine, as is regularly making a slight detour to stop at a newsagent on the way to work, or calling in at the
dentist on the way home.
Not so insignificant
If an employee regularly uses the company van to do the supermarket shopping, takes it away on a week's holiday or uses the van outside of work for
social activities, the driver needs to reconsider the van tax band. The distinction is important because where there's no tax charge on the van, there
will be no Na