Private use on commercially taxed vehicle.

CiniO

Hi all.

There was a huge thread about it on motors forum.
Plenty of different opinion, but generally the main conclusion was, that if you have a van taxed commercially (as goods vehicle) you are not allowed to use it for private purposes at all. The same opinion was shown on TV and radios, where it was even told it's illegal to use your van to go for a lunch during a break, if it's taxed commercially.
It's not new law, but so far law was not enforced. They just started enforcing it now.
That all came in few months ago.

I was actually never interested, as I never had a van.

But looking at some road traffic law, I discovered something.

Motor Vehicle (Duties and Licences) (No. 2) Act 2008

http://www.irishstatutebook.ie/2008/en/act/pub/0024/print.html


That act includes a schedule with all current motor tax rates.

5. Vehicles (including tricycles weighing more than 500 kilograms unladen) constructed or adapted for use and used for the conveyance of goods or burden of any other description in the course of trade or business (including agriculture and the performance by a local or public authority of its functions) and vehicles constructed or adapted for use and used for the conveyance of a machine, workshop, contrivance or implement by or in which goods being conveyed by such a vehicle are processed or manufactured while the vehicle is in motion—

(a) being vehicles which are electrically propelled and which do not exceed 1,500 kilograms in weight unladen,
€80
(b) being vehicles which are not such electrically propelled vehicles as aforesaid and which have a weight unladen—

(i) not exceeding 3,000 kilograms,
€288
(ii) exceeding 3,000 kilograms but not exceeding 4,000 kilograms,
€364
(iii) exceeding 4,000 kilograms but not exceeding 5,000 kilograms,
€470
(iv) exceeding 5,000 kilograms but not exceeding 6,000 kilograms,
€651
(v) exceeding 6,000 kilograms but not exceeding 7,000 kilograms,
€882
(vi) exceeding 7,000 kilograms but not exceeding 8,000 kilograms,
€1,110
(vii) exceeding 8,000 kilograms but not exceeding 20,000 kilograms,
€1,110 plus €261 for each 1,000 kilograms or part thereof in excess of 8,000 kilograms
(viii) exceeding 20,000 kilograms.
€4,496

I put bold font on what's important.
Vehicles constructed for use, and used for above purpose fall into above tax class.
It doesn't say, that vehicle has to be used solely for this purpose. It only says that it applies to vehicles used for above purpose.
I'm not a lawyer, but understanding it logically, it's perfectly legal to have a van taxed commercially (in the tax class described above), use it for work during the day, and then go with it to the cinema or shopping in the evening.
The condition written above is fulfilled, as car is used for convoyance of goods.

First I thought I might be wrong, as everyone was saying opposite.
But when you take a look on other parts of this act, you can see something like this.

6. Vehicles other than those charged with duty under the foregoing provisions of this Part of this Schedule:

(a) any vehicle which is used as a hearse and for no other purpose,
€88
(b) any vehicle (excluding a taxi) which is used as a small public service vehicle within the meaning of the Road Traffic Act 1961 , and for no other purpose,
€82
(c) any vehicle which is fitted with a taximeter and is lawfully used as a street service vehicle within the meaning of the Road Traffic Act 1961 , and for purposes incidental to such use and for no other purpose,
€82

Here it is clearly stated, that taxed under above classes, can be used for certain purposes, an for no other purposes.
That even more proof, that part stating about goods vehicles, used for convoying goods, does not require vehicles to be used only for that purpose, as otherwise it would be stated the same as here.


Obviously if the van is used only for private purposes (which is very often the case), then it can't be taxed under mentioned tax class (goods vehicles), but has to be taxed privately. Which is actually described in act as other vehicles which can't be taxed under any other class..

6. Vehicles other than those charged with duty under the foregoing provisions of this Part of this Schedule:

(...)
(e) subject to subparagraphs (f) and (g), other vehicles to which this paragraph applies and which—

(i) have an engine capacity—

(I) not exceeding 1,000 cubic centimetres,
€172
(II) exceeding 1,000 cubic centimetres but not exceeding 1,100 cubic centimetres,
€259
(III) exceeding 1,100 cubic centimetres but not exceeding 1,200 cubic centimetres,
€286
(...)

My conclusion is, that it looks like it's perfectly legal to have a van taxed commercially (as a goods vehicle) and use it for both commercial and private purposes.

Could anyone confirm if I'm right or wrong?

MagicSean

A vehicle used for commercial would fall under that. However once it is used as a private vehicle it falls under a second category also. Your interpretation is that you should be able to choose the category with the lower tax rate and completely ignore the other category it falls under. As you are only paying under the commercial category you can only use it for that purpose.

CiniO

k_mac wrote: »

A vehicle used for commercial would fall under that. However once it is used as a private vehicle it falls under a second category also.

I actually don't think that vehicle can fall under two categories.

As I said before, commercial category includes vehicles used for carriage of goods in course of a bussines. But doesn't limit it, only to such use.
So I understand that if this is one of possible uses of that vehicle, it can be taxed under that category.

The other category (private) is used only if vehicle doesn't fall into any of foregoing categories (including commercial).
So if vehicle falls under commercial category, it can't fall under private category.
Am I wrong with that?

Your interpretation is that you should be able to choose the category with the lower tax rate and completely ignore the other category it falls under.

Not at all.
I didn't say you should be able to choose category. It's not something that can be chosen. Vehicle must fall into one (and only one) of the categories.

It works both ways.
Why would motor tax office ask you to tax a van privately, if you are using it both for commercial and private purposes? Why would they be able to choose category?

As you are only paying under the commercial category you can only use it for that purpose.

But how can you explain, that it isn't stated there that vehicle can be used only for that purpose, and by other categories (f.e. taxi) it is?