The guide to van tax

Last updated by on July 7th, 2020

Alert: Some on the information on this page may no longer be relevant post-Brexit. For the most up to date information, please visit GOV.UK

Taxing a van isn’t the same as taxing a car and it’s further complicated by taxes levied for benefits-in-kind if your job comes with a company van. So, how do you work out what you owe, and what are the implications of using your van for personal use – read on to find out.

What is a van?

It might seem like a straightforward question with a simple answer – four wheels and bigger than a car, but the definition of a van – or light commercial vehicle (LCV) is a little more specific.

For tax purposes, HMRC, classifies a van as a ‘vehicle constructed for the carriage of goods’ that cannot weigh more than 3.5 tonnes when fully loaded.

Does my double cab or pick-up count as a van?

It depends on its official classification, but as a general rule, double cabs with two rows of seats and pick-ups can qualify as vans, if they can carry loads of over 1000kg. To be absolutely sure, refer to your van’s logbook, if it’s classed as an N1, or N2 vehicle, it’ll be taxed as a van.

How much van tax do I have to pay?

How much tax or vehicle excise duty (VED) as it’s officially called, you’ll need to pay, depends on when your van was made. Vans registered before 2001 are charged according to engine size:

• engines up to 1549cc pay £150 for 12 months
• engines bigger than 1549cc pay £245 for 12 months

Vans registered on or after 1 March 2001 are charged at £240 for 12 months, but there are a couple of exceptions to the rule.

Euro 4 vans (registered between 1 March 2003 – 31 December 2006) and Euro 5 vans (registered between 1 January 2009 and 31 December 2010) only pay £140.


What are benefit-in-kind rates?

If you’ve got a company van that doubles up for personal use, then you can be taxed for receiving this perk (the benefit-in-kind). However, if it’s considered that there is ‘insignificant private use’ then you won’t have to worry about the additional van tax.

So, what counts as personal use? Well, if you use your company van to do the school run, your weekly food shop, or habitually use it for home activities, then this all counts as personal use. If this is the case, then what you owe is calculated pro rata using your income tax band and a flat benefit-in-kind rate of £3,230.

For example, if you pay 20% income tax then you’ll be charged a benefit-in-kind sum of £646 (20% of £3,230). Higher tax band van drivers will have to pay £1,292 (40% of £3,230).

If you’re only using your company van to make ad hoc pitstops for a pint of milk or a one-off appointment somewhere, then you won’t need to pay any benefit-in-kind rates as this would be classed as ‘insignificant personal use’.

Is my van taxed?

If you can’t remember whether you’ve taxed your van, then no need to panic – as long as you have your number plate details, you can check quickly and easily online, at GOV.UK .

How can I save money on my van insurance?

Another compulsory cost to owning a van is your insurance – whether you use yours for your own business, deliveries, or if you just need short term cover – we understand that you need to be confident about being protected for all eventualities.

Which is why our advisors are on hand to guide you through what you might need – you can call us on 0330 022 8814, or start a quote online and see if you can get covered for less with our Cheapest Price Guarantee*.

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