WHAT HMRC’S CHANGE IN LEGISLATION MEANS FOR YOUR EXTENDED AND DOUBLE-CAB PICK-UP TRUCK
As of April 2025, HMRC has updated its Benefit-in-Kind (BIK) and Capital Allowances (CA) legislation, and this change significantly affects extended and double cab pick-up trucks in the UK. These vehicles are now classed as company cars for BIK and CA purposes, which may increase tax liabilities for businesses and drivers using them as company vehicles.
However, it’s not all change. Despite this shift, Isuzu D-Max pick-ups still qualify for key commercial vehicle benefits, provided they meet the necessary criteria:
- Annual Road Tax (Vehicle Excise Duty): Remains at a flat commercial vehicle rate of £345.
- VAT Reclaim: Still fully reclaimable for VAT-registered businesses, as the D-Max has over 1-tonne payload.
With this update causing confusion across drivers, accountants, and dealers, Isuzu UK is committed to helping you understand exactly how these changes apply. Whether you’re buying for business use or operating a fleet, we’re here with clear guidance, tools, and expert support to ensure you stay compliant while getting the most out of your pick-up.
If you would like to speak to your local dealer about these changes, please complete the below form:
FREQUENTLY ASKED QUESTIONS
Are double and extended cab pick-up trucks now classed as company cars?
Yes. As of 6th April 2025, HMRC classifies newly registered double and extended cab pick-ups as company cars for Benefit-in-Kind (BIK) and Capital Allowance (CA) purposes. This follows a Court of Appeal ruling stating these vehicles do not have a predominant goods-carrying purpose.
Has Vehicle Excise Duty (VED) changed for pick-ups?
No. Despite the change in classification for BIK and CA, VED (road tax) for double and extended cab pick-ups remains at the commercial vehicle rate of £345 per year, offering continued affordability for business users.
Can I still reclaim VAT on my pick-up?
Yes. VAT remains fully reclaimable on all double and extended cab pick-ups with a payload over 1 tonne, provided the business is VAT-registered and making fully taxable supplies. This key advantage continues to support businesses in sectors like farming, construction, and logistics.
How are BIK rates calculated under the new rules?
From 6th April 2025, BIK on double and extended cab pick-ups is calculated based on CO₂ emissions, just like company cars. Rates range from 3% to 37%:
Zero-emission pick-ups start at 3%, rising by 1% annually until 2028.
Higher-emission vehicles are taxed at proportionally higher rates.
Are there any transitional reliefs available?
Yes. Vehicles ordered, purchased, or leased before 6th April 2025 will retain the previous commercial vehicle BIK treatment until:
The vehicle is disposed of,
The lease expires, or
5th April 2029—whichever comes first.
How have Capital Allowance rules changed?
From:
1st April 2025 (for corporation tax), and
6th April 2025 (for income tax),
double and extended cab pick-ups no longer qualify as plant and machinery for CA purposes. Instead, they now follow company car writing-down allowances, which vary by CO₂ emissions:100% for zero-emission vehicles
18% or 6% for other vehicles, based on emissions bands
To qualify under the old regime, expenditure must be incurred before 1st October 2025.
Do these changes affect all pick-up trucks?
No. Single cab pick-ups are unaffected and will continue to be treated as commercial vehicles in all respects—BIK, VAT, VED, and CA.
Why has HMRC made this change?
The change stems from a Court of Appeal ruling which found that most double and extended cab pick-ups do not meet the standard for being “goods vehicles,” as they serve dual purposes. As a result, HMRC now classifies them as cars for tax purposes, specifically BIK and CA.
What are the new BIK changes and how do they affect double and extended pick-ups?
BENEFIT IN KIND (BIK)
HMRC has updated its legislation regarding the classification of extended and double cab pick-ups, with regards to BIK, to be considered as cars as opposed to commercial vehicles since 6th April 2025.
Double and extended cab pick-ups have moved away from the previously set flat rate of £4,020 (2025/26 tax year) and instead are subjected to the car BIK rate, which can vary between 3% and 37% based on the vehicle’s CO2. Since 6th April 2025, extended and double cab pick-ups with over 1-tonne payload are subject to company car BIK rates (3%), increasing by 1% annually until 2028.
CAPITAL ALLOWANCES (CA)
Capital allowances allow businesses to deduct some or all the value of the items (such as vehicles) from the profits before tax. Since 1st April 2025, extended and double cab pick-ups are also classified as company cars with regard to CA.
Double and extended cab pick-ups have moved away from the previous classification as ‘plant and machinery’ for CA purposes and instead are subjected to the company car rates, which can vary between 6%, 18% and 100%, based on the vehicle’s CO2
Will single cab pick-ups be affected by this?
Extended cab pick-ups are affected however single cabs will be unaffected by the changes as HMRC ruled that they demonstrate clear suitability for commercial use.
Isuzu UK’s commitment to supporting its customers is of utmost importance and Isuzu will continue to monitor developments closely and collaborate with industry stakeholders to help you navigate these changes effectively. Please stay informed of the upcoming changes by visiting the HMRC page regarding the legislative changes www.gov.uk/government/publications/autumn-budget-2024.
(Information for guidance purposes only and subject to change)
