Landrover Defender (and other commercials): RF111a Goods Only Declaration is ILLEGAL

happybob

(Discuss)

RF111A:

“I declare that vehicle registration number [insert number] will be used only as a goods carrying vehicle in the course of my business/trade and will not be used at any time for social, domestic or pleasure purposes.”


FINANCE ACT 1952 AS (INACCURATELY) QUOTED IN DAIL QUESTIONS:


(see www.oireachtas.ie, search for RF111a in questions/debates)
(see www.irishstatutebook.ie)


2.—(1) Where—

(a) a licence under section 1 of this Act is in force,

(b) the vehicle is used in a condition or manner or for a purpose which would, if it was used solely in that condition or manner or for that purpose, render it chargeable with duty at a rate higher than that at which duty has been paid, and

(c) the vehicle as so used is in all other respects a vehicle chargeable with duty at the higher rate,

duty shall become and be chargeable on the vehicle at the higher rate.

(2) Where a person so uses a vehicle that duty becomes chargeable in accordance with this section at a higher rate, the person shall, unless duty has been paid at the higher rate before the commencement of such user, be guilty of an offence and be liable on summary conviction to an excise penalty of (whichever is the greater) twenty pounds or three times the difference between the duty paid and duty at the higher rate.

(3) Notwithstanding any provision to the contrary contained in any enactment relating to the recovery or application of excise penalties, any penalty under this section may be recovered and enforced at the suit of any member of the Garda Síochána, and in that case the Court shall have power to mitigate the penalty to such amount as the Court may in its discretion think fit, and the licensing authority shall not have power to mitigate the penalty.

(4) Sums paid into the Exchequer in respect of penalties under this section shall, for the purpose of section 2 of the Roads Act, 1920, be deemed to have been paid into the Exchequer under that Act.

CONCLUSION:

This act does not require, contrary to quotation by Minister John Gormley and subsequently Minister Phil Hogan that a vehicle chargeable at a lower rate becomes chargeable at a higher rate if it is partially used for the purposes of a vehicle at the higher rate.

On the contrary, a commercial vehicle would need to be used exclusively as a private vehicle before being required to be taxed as a private vehicle.

The current declaration on the form RF111a reverses the meaning of the law. My view is that the RF111a is essentially illegal and legally unenforceable.

The 1992 act has similar text and would require for a complete change of use before requiring the vehicle be taxed as a private vehicle.

BarryM

I haven't had time to check here - http://www.irishstatutebook.ie/isbc/1952.html#a24_1952

whether the section of the '52 act has been altered to allow the RF111A statement?

Seems too obvious an error to me to have survived some so-called smart lawyer.....

Anyway, we all know the 'blanked out windows' trick. Pay the tax if you use the rig to go to mass, and confess your sins......:(

KELTICKNIGHTT

BarryM wrote: »

I haven't had time to check here - http://www.irishstatutebook.ie/isbc/1952.html#a24_1952

whether the section of the '52 act has been altered to allow the RF111A statement?

Seems too obvious an error to me to have survived some so-called smart lawyer.....

Anyway, we all know the 'blanked out windows' trick. Pay the tax if you use the rig to go to mass, and confess your sins......:(

ok Gormley :-}

TrailerBob

Interestingly my jeep is insured for social, domestic and pleasure use... Under a commercial policy! If nothing else I'm glad the RF111A has gotten rid of the X5/ RR Sport commercials... Ludicrous carry on...

happybob

The 1992 text is more restrictive and supports what the minister has been saying in Dáil questions.

Change of use of vehicle.


7. Where it is intended to use a vehicle in respect of which a licence is in force in a condition or manner or for a purpose which would, if it was used solely in that condition or manner or for that purpose, render it chargeable with duty at a rate higher than that at which duty has been paid, the following provisions shall apply:—


( a ) the owner shall return to the licensing authority the licence and vehicle licensing certificate or registration book as appropriate, issued in respect of the vehicle;


( b ) the owner shall make application (by means of a prescribed declaration in the scheduled form) to the licensing authority for a new licence appropriate to the new condition, manner or purpose;


( c ) the owner shall pay to the licensing authority the difference between—


(i) the amount of duty which would, at the rate of duty appropriate to the vehicle before the change of condition, manner or purpose, be payable on a new licence for the period commencing at the date of the change of condition, manner or purpose and expiring at the end of the period for which the licence was originally issued, and


(ii) the amount of the duty which would be payable on a new licence for the like period at the rate of duty appropriate to the vehicle on the basis of the new condition, manner or purpose, and


( d ) the licensing authority shall, if satisfied that the licence applied for is the appropriate licence for the vehicle specified in the prescribed declaration, issue a new licence to the owner, amend the registration book, if any, in accordance with directions issued by the Minister from time to time, and return the registration book, if any, to the owner or in the case where a licensing certificate has been issued for the vehicle request the Minister to issue a replacement licensing certificate to the owner containing the amended details.


So, its unclear why both current and prior ministers have referred to the 1952 act when the 1992 SI appears to be the more relevant piece of legislation actually supporting their position.

All said, the law is one thing, and what is reasonable is another.

Esel

happybob wrote: »

RF111A:

“I declare that vehicle registration number [insert number] will be used only as a goods carrying vehicle in the course of my business/trade and will not be used at any time for social, domestic or pleasure purposes.”


FINANCE ACT 1952 AS (INACCURATELY) QUOTED IN DAIL QUESTIONS:


(see www.oireachtas.ie, search for RF111a in questions/debates)
(see www.irishstatutebook.ie)


2.—(1) Where—

(a) a licence under section 1 of this Act is in force,

(b) the vehicle is used in a condition or manner or for a purpose which would, if it was used solely in that condition or manner or for that purpose, render it chargeable with duty at a rate higher than that at which duty has been paid, and

(c) the vehicle as so used is in all other respects a vehicle chargeable with duty at the higher rate,

duty shall become and be chargeable on the vehicle at the higher rate.

CONCLUSION:

This act does not require, contrary to quotation by Minister John Gormley and subsequently Minister Phil Hogan that a vehicle chargeable at a lower rate becomes chargeable at a higher rate if it is partially used for the purposes of a vehicle at the higher rate.

On the contrary, a commercial vehicle would need to be used exclusively as a private vehicle before being required to be taxed as a private vehicle.

I think your conclusion is wrong. See the text I have enlarged above. This would seem to cover occasional, non-sole use.

happybob

I made that mistake myself prevously. You actually agree with me, but probably for the wrong reason.

What the text for (b) means:

"If the vehicle is used at all as if it was a private vehicle, then it should be taxed as a private vehicle."

However, for the Section 2 to effect, (a)+(b)+(c) need to be true.

(c) Provides that the vehicle as so used, is in all other respects a vehicle chargeable at the higher rate.

It would seem to me that (c) would not be true for a designed commercial vehicle having principal use as a commercial vehicle and incidental SD&P use.

Not withstanding all of the above, see my later post regarding the 1992 act, which is more succinct in this regard and is effectively cut short in meaning to:

"If the vehicle is used at all as if it was a private vehicle, then it should be taxed as a private vehicle."

So, the law is the law, but the question remains as to whether or not the situation is reasonable and it should be a question for the minister, via your elected representatives, to address.

It would seem unreasonable in most cases to deny incidental private usage on commercial vehicles.

Question also remains why successive ministers have quoted the 1952 act when the 1952 Act would appear to support incidental private usage, wheras the 1992 S/I does not.

Esel

I see your point.

BarryM

happybob wrote: »

All said, the law is one thing, and what is reasonable is another.

What is reasonable is a rulebook that does away with even the possibility of cheating. The present nonsense is an invitation to try to buck the system and, afaics, widely abused by all sorts of people.

The supermarket car parks around the country are full of 4wd objects with a cab/no back windows/whatever your having yourself, and Mrs is inside shopping. I don't recall ever seeing a check in such obvious places. Of course outside mass would be even easier but that wouldn't be reasonable....:P

BarryM

happybob wrote: »

Question also remains why successive ministers have quoted the 1952 act when the 1952 Act would appear to support incidental private usage, wheras the 1992 S/I does not.

The usual formula is "The xxxx Act as amended" afaik, this is accepted even if you don't mention it.

B

Our man in Havana

BarryM wrote: »

What is reasonable is a rulebook that does away with even the possibility of cheating. The present nonsense is an invitation to try to buck the system and, afaics, widely abused by all sorts of people.

The supermarket car parks around the country are full of 4wd objects with a cab/no back windows/whatever your having yourself, and Mrs is inside shopping. I don't recall ever seeing a check in such obvious places. Of course outside mass would be even easier but that wouldn't be reasonable....:P

I do remember a few years ago, the customs and excise did a raid on mass goers in the midlands looking for green diesel. The results were interesting to say the least.

happybob

BarryM wrote: »

What is reasonable is a rulebook that does away with even the possibility of cheating. The present nonsense is an invitation to try to buck the system and, afaics, widely abused by all sorts of people.

The supermarket car parks around the country are full of 4wd objects with a cab/no back windows/whatever your having yourself, and Mrs is inside shopping. I don't recall ever seeing a check in such obvious places. Of course outside mass would be even easier but that wouldn't be reasonable....:P

Two things to say about this:

(1) It is not reasonable to penalise genuine commercial vehicle users with incidental private usage because of the actions of disingenuous ones.

(2) The rule book as it stands isn't stopping anything. If it doesn't work, it should be changed, and if it's changed, it should also avoid forcing people who might have incidental private usage from having to sign a declaration that says otherwise.

Eric Cartman

TrailerBob wrote: »

I'm glad the RF111A has gotten rid of the X5/ RR Sport commercials... Ludicrous carry on...

Nothing wrong with them , great vehicles fit for purpose if used correctly, great load space and towing.

Not eveyone who drives a commercial should have to be subjected to a rattly van with no air conditioning and cloth seats

TrailerBob

Eric Cartman wrote: »

Nothing wrong with them , great vehicles fit for purpose if used correctly, great load space and towing.

Not eveyone who drives a commercial should have to be subjected to a rattly van with no air conditioning and cloth seats

Fair enough point, but many I have seen are not used for anything more than posing, and put through the company books.for the missus to drive. It's a bit like the Landcruiser crew cab loophole a few years back.. If you can afford to lay out 100k on a jeep, then why go to lengths to avoid the full tax. Maybe I'm just bitter and twisted as all I can afford is a 9 year old cruiser with cloth seats!!

KELTICKNIGHTT

Our man in Havana wrote: »

I do remember a few years ago, the customs and excise did a raid on mass goers in the midlands looking for green diesel. The results were interesting to say the least.

would think diesel is different issue , wouldn't you think

Our man in Havana

KELTICKNIGHTT wrote: »

would think diesel is different issue , wouldn't you think

Same principle, it is all tax evasion.

KELTICKNIGHTT

Our man in Havana wrote: »

Same principle, it is all tax evasion.

thats stretching it , 2 different areas, tax on diesel is one thing but begrudging about commericals is another

Our man in Havana

As an owner of a commercial on private tax I certainly consider it tax evasion.

KELTICKNIGHTT

Our man in Havana wrote: »

As an owner of a commercial on private tax I certainly consider it tax evasion.

explain ?

happybob

... to keep in mind the difference between what is right in law, and what is reasonable in practice, as you thread through this conversation.

Certainly, according to law, it is not permissible to use a commercially licenced vehicle for private (even incidental private) use, since to do so would attract the higher rate of road tax (private licence).

It in turn follows, that to use a commercially licenced vehicle for incidental private use, is not legal. It also therefore follows, that it is, in purely legal terms, tax evasion, to use it for incidental private use.

However, with respect to a test of reasonableness and the general 'spirit' of commercial vehicle use, I would not consider incidental private use of a commercially licenced vehicle to be tax evasion.

For example: If I happened to be a plumber with a van, and I also happen to own a private car, and using the van, drop my kids off to school on the way to a job, am I evading tax? Actually, what I'm doing is using my head, saving fuel and avoiding making a completely unnecessary additional trip, which might also incidentally have cost me an hour or so of billable time, or required me to work an extra hour at the end of the day to compensate.

In fact, by the strictest letter of the law, if you go to lunch in the van (or even eat a packed lunch in the van), that would represent incidental private use, since having lunch is not part of your commercial enterprise. Disagree? Then trying claiming for all of your lunches against tax and see what happens.

There are many such examples that indicate incidental private use is acceptable, and underly why, individuals should not be forced into making a restrictive RF111a declaration, especially, since most know full well they will often, even if only in some small way, be in breach of that declaration.

The Gardaí are well aware of that, and so in practice enforcement tends to overlook that.

Policy needs to support what is reasonable in practice. That needs to be effected in law so that individuals are not personnally comprised by the law, and implementation thereof.

Note again that the 1952 Act wording appears to support incidental private use. The 1958 SI has wording that is contrary, as does the 1992 SI. Whether or not that was deliberate, or just someone dropping the ball, remains to be answered.

BarryM

happybob wrote: »

... to keep in mind the difference between what is right in law, and what is reasonable in practice, as you thread through this conversation.

The answer to the (sort of) impeccable logic in your post is - do away with the distinction. If you are legally registered as a 'commercial' entity (an open question) then you can deduct the cost of the vehicle and its tax and insurance from your tax bill. This would eliminate the need for the declaration - and salve your conscience?? However, it would need to be replaced by a crackdown on unregistered people driving commercial vehicles. Now, there's a political tough one, farmers would have to register their 'business' - don't hold yer breath, the nonsense will continue.