What the April 2025 Double Cab Pick-Up Tax Change Means for You

As of April 2025, significant tax changes will impact double cab pick-up vehicles in the UK, potentially altering the way many business owners manage their fleets. Under these new rules, double cabs will no longer qualify as commercial vehicles for tax purposes. Instead, they’ll be taxed as cars, meaning that key tax reliefs and the lower Benefit-in-Kind (BIK) rates previously available will no longer apply. This shift could result in higher tax liabilities for those using these vehicles privately and calls for a proactive approach. Here, we break down what these changes entail and how you can optimise your fleet decisions before the new rules take effect.

Key Changes for Business Owners

From April 2025, double cab pick-ups will be taxed in line with cars, which leads to several significant changes:

• Capital Allowances: Double cab pick-ups acquired before April 2025 will retain their current tax reliefs, such as full expensing and Annual Investment Allowance (AIA). Vehicles purchased after this date, however, will only qualify for car-related allowances, typically less advantageous.
• Benefit-in-Kind (BIK) Rates: Moving to a car-based BIK calculation means higher tax liabilities for employees using these vehicles privately, especially for those with high CO2 emissions. For example, models like the Ford Ranger will see BIK values rise from under £4,000 to over £20,000, potentially increasing tax by more than £3,500 annually for basic-rate taxpayers and even more for higher earners.
• VAT Treatment: For VAT purposes, double cab pick-ups with a payload of over one tonne will continue to be classified as commercial vehicles. This can benefit businesses eligible for VAT reclaims, although this distinction does not impact the BIK treatment or general tax classification.

Planning Ahead: Your Options

To prepare for this transition, consider the following steps:

• Secure Current Tax Benefits: Acquiring double cab pick-ups before April 2025 means you’ll retain the existing, more favourable tax treatment, with transitional BIK rules in place until April 2029.
• Evaluate Fleet Options: Assess whether alternative vehicles may be more cost-effective under the new rules. For instance, single cab pick-ups remain unaffected, and electric vehicle options could offer a tax advantage, particularly given the rising tax burden on high-emission vehicles.

These changes reflect a broader shift in tax policy following a 2020 court case involving Coca-Cola, which first challenged the commercial classification of double cab pick-ups. Though temporarily reversed earlier this year, the government has confirmed this adjustment in its Autumn Budget.

Need Help Navigating These Updates?
If you’re uncertain how this change will affect your tax position, or if you want to explore the best fleet options moving forward, our team is here to help. Contact us for tailored guidance on aligning your fleet strategy with the new tax landscape.