Fleet operators can breathe a sigh of relief as HMRC has clarified the tax treatment of reallocated double cab pick-up trucks under new rules set to take effect on April 6, 2025.

Transitional Tax Rules for Pick-Up Trucks

The Government announced in the Autumn Budget that from April 6, 2025, double cab pick-up trucks will be taxed as company cars rather than vans. However, transitional benefit-in-kind (BIK) tax arrangements apply to vehicles purchased, leased, or ordered before this date—regardless of when they are delivered.

Initially, HMRC guidance suggested that if a pick-up was reassigned to a different employee after April 6, it would lose its transitional tax status. However, after concerns were raised by tax specialists and industry bodies, HMRC has now clarified that reallocated vehicles will retain their transitional treatment.

An HMRC spokesperson confirmed: “If an employer transfers a double cab pick-up to another employee between April 6, 2025, and April 5, 2029, it may continue to be treated as a van for tax purposes, provided there is no disposal and the lease remains active.”

Tax expert David Chandler, co-founder of HRUX, welcomed this clarification: “The original guidance was understandable but would have been unfair to both employers and employees. This update ensures businesses can apply the transitional rules as expected.”

New ‘Car or Van’ Tax Rule

A separate HMRC update on double cab pick-up classification, issued in February, has sparked further discussion. According to the guidance (EIM23110), any vehicle with side windows behind the front seats is now classed as a car. This follows a Court of Appeal ruling in the Coca-Cola tax case, which determined that a vehicle must be designed primarily for carrying goods to qualify as a van.

Tax specialist Harvey Perkins of HRUX explained: “Under this definition, it’s nearly impossible to argue that a double cab pick-up is not a car.” He also noted that while HMRC guidance helps simplify tax compliance, the legal framework remains the ultimate authority.

What This Means for Fleets

Reallocated pick-ups keep their transitional tax status if reassigned before April 5, 2029, without disposal or lease termination.

New tax rules confirm double cab pick-ups will be treated as company cars if they have rear side windows and seating capability.

Businesses should review fleet tax strategies in light of these changes to avoid unexpected liabilities.

With this clarification, fleet managers can plan with greater confidence, ensuring compliance while minimizing tax burdens. Industry bodies, including the BVRLA, continue to engage with HMRC on further guidance.