Benefit-In-Kind
The Isuzu Rodeo Double Cab has won critical acclaim for its bullet proof reliability and best-in-class, fit for purpose engineering and countless best in class attributes. With a payload of 1000kg+, the Denver, Denver Max and the Denver Max LE are classed as commercial vehicles, even with a canopy fitted.
Do Pick Up trucks still attract tax advantages?
From 6th April 2007 the BIK tax levy changed, but the answer is still a big 'YES'! Driving an Isuzu Rodeo can save you significant amounts of tax compared to an equivalently priced non LCV (Light Commercial) vehicle.
If you drive an Isuzu Rodeo for unrestricted private use, your BIK liability is £3,000 x your marginal tax rate as from the 6th April 2007. A 40% tax payer will pay only £1,200 in tax (a 22% tax payer will pay just £660).
If your employer provides your fuel to include unrestricted private use, an additional BIK liability of £500 will apply. The actual tax payable is calculated on the same basis: a 40% tax payer will pay only £200 (a 22% tax payer will pay just £110).
Employees who use the Rodeo for business purposes only (and do not use the vehicle for private purposes) have no tax liability.
Sole Trader / Partnership LCV Tax Allowances and Rules
The BIK changes to 'Van tax' introduced 6th April 2007 do not affect Sole Traders or Partnerships. Tax Allowances fall into 3 categories:
- Capital Allowances
- VAT Allowances
- Funding Allowances
Capital Allowances
Small sized businesses qualify for 1st year write down allowance of 40% (VAT exclusive) and medium sized qualify for an allowance of 50%. Thereafter 25% per year of the balance remaining. If the vehicle is sold at the end for more than the written down value the balance is taxable, if sold for a loss then there is an additional allowance.
VAT Allowances
LCV's qualify for a VAT reclaim subject to the business being VAT registered & the vehicle being purchased outright or on a finance purchase plan.
Funding Allowances
VAT on hire plan rentals (Leasing or Contract Hire) is also fully reclaimable.
VAT
VAT may be reclaimed by VAT registered businesses that purchase a qualifying commercial vehicle to the extent that the vehicle is used for taxable purposes i.e. if a vehicle is used 50% for business purposes and 50% for private purposes then only 50% of the VAT paid can be recovered. The same rule applies to fuel purchases by a business (this is not generally known and HM Revenue & Customs regularly penalises employers underpaying tax on this basis).
DISCLAIMER
Tax information is provided as a guide only. The tax allowances detailed are subject to timing differences and the status of your business. You should check with your Accountant or Tax Adviser that you are eligible to take advantage of these allowances. Personal use of these vehicles may give rise to a tax assessment and we recommend you discuss this with your own Accountant or Tax Adviser. Details correct at time of writing. Tax liability can vary according to circumstances. Please contact your local Inland Revenue office for further information. Isuzu UK accepts no responsibility for individuals misinterpreting information provided as a guide only. You can contact The Inland Revenue Contact Centre on 0845 300 3939 or visit their web site at inlandrevenue.gov.uk.