HMRC has issued new guidance on a change in the interpretation of how Double-Cab Pickup (DCPU) vehicles should be classified for car benefit, capital allowances, and certain deductions from business profits.

Previously, HMRC accepted that if a DCPU had a payload of 1 tonne or more, it was classified as a goods vehicle rather than a car, making it eligible for beneficial capital allowances and favourable benefit-in-kind treatment.

Following the government’s announcement in the Autumn Budget 2024, from April 2025 (1st for companies, 6th for individuals), HMRC will no longer apply the payload test. Instead, the classification will be based on the vehicle’s primary suitability at the time of construction. As DCPUs are considered ‘dual-purpose’ and not primarily designed for carrying goods or burden, they will now be classed as cars.

Transitional arrangements are in place. If you are considering purchasing a DCPU, ordering one before 6 April 2025 could allow you to benefit from the more favourable benefit-in-kind tax treatment applicable to goods vehicles for a few more years. For capital allowances purposes, entering into a contract to purchase a DCPU before 1/6 April 2025 will secure the beneficial capital allowances treatment for goods vehicles, provided the obligation to pay for the DCPU arises before 1 October 2025.