BIK on N1 Commercial 5 Seater

Baldy1980

Hi All

Apologies for reopening a very old thread but have read all of this down and am still a little unclear on what all of the end to end tax treatment is. For clarity, my circumstances are that I am looking at an N1 as a company car - and will be paying BIK as I have personal use.

VRT - this is clear, as car I am looking at is N1 certified at factory, it gets lower VRT

VAT - based on the other posts I see on this site, it seems everyone operates on basis that VAT can be reclaimed. However after reading the Revenue site, it appears to me that the VAT can only be reclaimed if the car will be used for commercial purposes? (I am thinking that this is just being ignored by people)

Road Tax - if you are paying BIK this implies you have personal use. THis means you cannot avail of the lower commercial €333 band and should the tax the vehicle as a personal vehicle.

BIK - again, if you have personal use, then clearly you fall into the BIK regime.


Does anyone have a view on the VAT treatment in particular? Am I being too 'prudent' as I have a feeling the whole country is reclaiming the VAT even though it is inevitable that there is personal use of 99% of these N1 vehicles??

Cheers

Mc-BigE

I was looking at the Ford Kuga 4 seater commercial, which for some bizarre reason falls into the same N1 commercial category as the L.R and Pajero and VWs new Touareg .

Im not sure how they get away with it, but by "removing" the center seat belt and headrest and putting a small sign at the back of the centre console saying "Don't sit here, this vehicle has only 4 seats"

i inquired to my local Ford garage about one that was on carzone and when i asked him about BIK on the vehicle, he said its a commercial vehicle and as such is classed as a Van not a Car.

I asked him could he get something in writing to say this from the revenue.


i haven't heard from him since.

i would like to get one, but im not prepared to take the risk, not so much for getting stopped by the guards for having someone in the back, but more about a revenue audit.

but if you were to pay the car BIK, it does make the cheapest option as the price new is around 30K and not 55K ish for the others.

Casati

Mc-BigE wrote: »

I was looking at the Ford Kuga 4 seater commercial, which for some bizarre reason falls into the same N1 commercial category as the L.R and Pajero and VWs new Touareg .

Im not sure how they get away with it, but by "removing" the center seat belt and headrest and putting a small sign at the back of the centre console saying "Don't sit here, this vehicle has only 4 seats"

i inquired to my local Ford garage about one that was on carzone and when i asked him about BIK on the vehicle, he said its a commercial vehicle and as such is classed as a Van not a Car.

I asked him could he get something in writing to say this from the revenue.


i haven't heard from him since.

i would like to get one, but im not prepared to take the risk, not so much for getting stopped by the guards for having someone in the back, but more about a revenue audit.

but if you were to pay the car BIK, it does make the cheapest option as the price new is around 30K and not 55K ish for the others.

But your comparing apples to pears there. You can get a new Kuga 5 seater for very close to the price of the 4 seater at the moment. The VAT would maybe make it slightly cheaper but not by much as Ford as big discounts not he passenger cars. Its a very different animal to a Disco or Landcruiser so dont think you can compare them.

buzz11

Mc-BigE wrote: »

i inquired to my local Ford garage about one that was on carzone and when i asked him about BIK on the vehicle, he said its a commercial vehicle and as such is classed as a Van not a Car.

I asked him could he get something in writing to say this from the revenue.


i haven't heard from him since.

i would like to get one, but im not prepared to take the risk, not so much for getting stopped by the guards for having someone in the back, but more about a revenue audit.

but if you were to pay the car BIK, it does make the cheapest option as the price new is around 30K and not 55K ish for the others.

What level of mileage do you do in a year? See calculator below regarding BIK costs;

https://www.paylesstax.ie/benefit-in-kind-calculator/

Mc-BigE

i do around 20000 km a year.

Mc-BigE

Casati wrote: »

But your comparing apples to pears there. You can get a new Kuga 5 seater for very close to the price of the 4 seater at the moment. The VAT would maybe make it slightly cheaper but not by much as Ford as big discounts not he passenger cars. Its a very different animal to a Disco or Landcruiser so dont think you can compare them.

the only comparison is that they're both classed the same, N1 Commercial, there is also a very big difference in OMV price on the Disco verses the Kuga. which makes the BIK cheaper.

the only reason i would get one of these N1 commercial utilities was if the revenue were to say its classed as a Van and not a Car, because if its a car then, yes the Kuga 5 seater ( or any car) would be the way to go.

Drummerboy08

They are classed as cars for BIK purposes.

Mc-BigE

Just wondering, as it's been a few years now since the N1 cat C commercial has been around, are there any owners on here or you know if who have gone through a revenue audit and they had to pay 30% bik on their "car" instead of "van". Or if they have successfully argued that their crew cab is indeed a van or that they don't use it other than for work ( how do you prove that)

Thanks

R.O.R

Mc-BigE wrote: »

Just wondering, as it's been a few years now since the N1 cat C commercial has been around, are there any owners on here or you know if who have gone through a revenue audit and they had to pay 30% bik on their "car" instead of "van". Or if they have successfully argued that their crew cab is indeed a van or that they don't use it other than for work ( how do you prove that)

Thanks

It cannot be classified as a Van for BIK purposes if it has seats or windows behind the driver - that's the revenue definition of a Van for BIK purposes.


Another small ish thing to consider is the M50. As these N1 vehicles are registered as commercials, they pay about twice as much to cross the M50 Toll as the passenger version. That can add up if you were to commute that way every day.

Mc-BigE

R.O.R wrote: »

It cannot be classified as a Van for BIK purposes if it has seats or windows behind the driver - that's the revenue definition of a Van for BIK purposes.


Another small ish thing to consider is the M50. As these N1 vehicles are registered as commercials, they pay about twice as much to cross the M50 Toll as the passenger version. That can add up if you were to commute that way every day.

Thats true, eflow/easytrip/VRT/Road Tax/DOE think that its a van but revenue thinks its a Car for BIK, the irish system is so fu$ked up.

anyway this really wasn't my question, we (i) have been down this road before regarding car or van, i just want to know if anyone has been audited with one of these, just to see if they were able to fight it or did they have to repay the 30% BIK

edited: just had a look at the eflow website : car is 2.60 (registered with no tag) van less than 2000kg is 3.40 and 4.70 for over 2000kg

which is more, but then again if your using it for business, then you should be able to claim back the toll as an expenses, and get the VAT off

jiggajt

I am a one man band consultant engineer looking to buy a crew cab pickup which i will also use for personal use and i am pretty pissed off about the lack of clarity from revenue regarding BIK. The rules state that as long as it has a goods storage compartment behind the drivers seats (which in my books a crew cab pickup has) then it should be classified under the 5% BIK rules.

I think what pisses me off most about it is the amount of people i know who are driving around with kids seats in the back paying NO BIK.

It is not feasible for me to pay 20%, it is not feasible for me to purchase a vehicle solely for commercial purposes and leave it at the office as my office is at home and it is not feasible for me to do nothing as i will lose a valuable contract.

In the UK, all pickups are classified as commercial from a BIK point of view once they can carry a payload of 980Kg or so.

Casati

jiggajt wrote: »

I am a one man band consultant engineer looking to buy a crew cab pickup which i will also use for personal use and i am pretty pissed off about the lack of clarity from revenue regarding BIK. The rules state that as long as it has a goods storage compartment behind the drivers seats (which in my books a crew cab pickup has) then it should be classified under the 5% BIK rules.

I think what pisses me off most about it is the amount of people i know who are driving around with kids seats in the back paying NO BIK.

It is not feasible for me to pay 20%, it is not feasible for me to purchase a vehicle solely for commercial purposes and leave it at the office as my office is at home and it is not feasible for me to do nothing as i will lose a valuable contract.

In the UK, all pickups are classified as commercial from a BIK point of view once they can carry a payload of 980Kg or so.

If you leave the vehicle at your office ordinary are you not exempt from BIK?

Revenue don't say your office can't also be your home do they?

jiggajt

jiggajt wrote: »

I am a one man band consultant engineer looking to buy a crew cab pickup which i will also use for personal use and i am pretty pissed off about the lack of clarity from revenue regarding BIK. The rules state that as long as it has a goods storage compartment behind the drivers seats (which in my books a crew cab pickup has) then it should be classified under the 5% BIK rules.

I think what pisses me off most about it is the amount of people i know who are driving around with kids seats in the back paying NO BIK.

It is not feasible for me to pay 20%, it is not feasible for me to purchase a vehicle solely for commercial purposes and leave it at the office as my office is at home and it is not feasible for me to do nothing as i will lose a valuable contract.

In the UK, all pickups are classified as commercial from a BIK point of view once they can carry a payload of 980Kg or so.

You could just buy it yourself and reclaim the VAT (if vat registered) rather than buy through the company. You will still be able to write it off as a capital allowance but won't have to mess around with BIK. Would there be really that much of a cost saving by buying it in the name of your company and paying 5% BIK compared to buying it yourself as above?

Mc-BigE

how can you claim the vat back if you buy it personally? surely it would have to be owned by the company , not you, to claim the vat back?  also its pre-tax income that you are using , not net which is also a saving

Im in the same boat as jiggajt above, i still have a 2 seater van and dont think its worth the hassle or sleepless nights waiting for an audit letter. i suppose there are other people that sleep better than i do (with baby seats in the back etc) 

Depends on how he is setup for tax. You will find that a lot of people can claim back the VAT on stuff they buy in their own name.

Casati

Opal Sticky Mermaid wrote: »

Depends on how he is setup for tax. You will find that a lot of people can claim back the VAT on stuff they buy in their own name.

Not legally there isn't, for the company to claim the vat back the company would have to purchase and pay for the vehicle

Casati

Casati wrote: »

Not legally there isn't, for the company to claim the vat back the company would have to purchase and pay for the vehicle

If it's a one man don't show he may be the company though.

Sole traders, farmers etc would have a vat number associated with their name as an example and a jeep they buy would be in their name but vat can still of course be reclaimed.

jiggajt

Opal Sticky Mermaid wrote: »

You could just buy it yourself and reclaim the VAT (if vat registered) rather than buy through the company. You will still be able to write it off as a capital allowance but won't have to mess around with BIK. Would there be really that much of a cost saving by buying it in the name of your company and paying 5% BIK compared to buying it yourself as above?

How does the reclaim of VAT myself work? I am a limited company not a sole trader if that is what you are referring to.

The savings are pretty substantial particularly if you need a heavy duty vehicle like this for work which i do. You can put the cost of the vehicle, VRT, Road Tax, Insurance, Fuel and Maintenance all through the company "pre-tax" unlike what i am doing now with my car. I think you can also write the depreciation of the vehicle off against tax which is another benefit.

barneystinson

Opal Sticky Mermaid wrote: »

If it's a one man don't show he may be the company though.

Sole traders, farmers etc would have a vat number associated with their name as an example and a jeep they buy would be in their name but vat can still of course be reclaimed.

The thread is about BIK on company owned vehicles, and the poster resurrecting the thread mentioned BIK, so quite clearly he's trading through a company...

jiggajt

Mc-BigE wrote: »

Im in the same boat as jiggajt above, i still have a 2 seater van and dont think its worth the hassle or sleepless nights waiting for an audit letter. i suppose there are other people that sleep better than i do (with baby seats in the back etc) 

I hear you my friend. How many people do you see driving around in and X5 or a Range Rover with blackened rear windows on sites. You just know they are paying the lower BIK rate if they are paying it at ALL??? This appears to be widespread and part of me just wants to go ahead and do it as even if they do crack down on it surely the problem is too rife for them to fine everyone???

What i find weird is that if you buy such a vehicle you CAN register it as a commercial for VRT and MotorTax but NOT for BIK... How does that work???:mad:

I genuinely need a twin cab 4 X 4 with goods carriage in the back for this job i am doing.

jiggajt

Ok, so here is the definition of a VAN for BIK purposes as per revenue themselves. Please correct me if i am wrong in my analysis:


Meaning of “van”
A van means a mechanically propelled vehicle which –
· Is designed or constructed solely or mainly for the carriage of goods or other burden, and
· Has a roofed area or areas to the rear of the driver’s seat, and
· Has no side windows or seating fitted in that roofed area or areas.
Where a crew cab or other similar type of vehicle meets all of these criteria it would be regarded as a van rather than a car.

So if i purchase a twin cab hilux such as this one:

http://www.utecanopies.com.au/Images/gallery/large%20images/hilux_05_gse-s.jpg

Is it a mechanically propelled vehicle??? YES

Is it designed or constructed solely or mainly for the carriage of good or other burden???....... It has firm rear suspension so that it can carry 1100Kg of payload in the back so i would argue YES

Does it have a roofed area or areas to the rear of the driver’s seat??? Not directly behind the drivers seat but as the one in the picture has a canopy over the rear then YES

Has no windows or seats in this area??? the one in the picture has tinted windows in the canopy but you can get ones that dont so...... YES

"Where a crew cab or other similar type of vehicle meets all of these criteria it would be regarded as a van rather than a car." YES

What am i missing here???

BoatMad

jiggajt wrote: »

I am a one man band consultant engineer looking to buy a crew cab pickup which i will also use for personal use and i am pretty pissed off about the lack of clarity from revenue regarding BIK. The rules state that as long as it has a goods storage compartment behind the drivers seats (which in my books a crew cab pickup has) then it should be classified under the 5% BIK rules.

I think what pisses me off most about it is the amount of people i know who are driving around with kids seats in the back paying NO BIK.

It is not feasible for me to pay 20%, it is not feasible for me to purchase a vehicle solely for commercial purposes and leave it at the office as my office is at home and it is not feasible for me to do nothing as i will lose a valuable contract.

In the UK, all pickups are classified as commercial from a BIK point of view once they can carry a payload of 980Kg or so.

let me clarify it for you , as Im in the exact same situation

tax and BIK are not the same, a crew cab "can" be regarded as commercial for motor tax, BUT it is not a VAN as far as BIK is concerned

You will pay full BIK on a crew cab

buy a second hand one privately and pay yourself civil service milage rates

BoatMad

jiggajt wrote: »

Ok, so here is the definition of a VAN for BIK purposes as per revenue themselves. Please correct me if i am wrong in my analysis:


Meaning of “van”
A van means a mechanically propelled vehicle which –
· Is designed or constructed solely or mainly for the carriage of goods or other burden, and
· Has a roofed area or areas to the rear of the driver’s seat, and
· Has no side windows or seating fitted in that roofed area or areas.
Where a crew cab or other similar type of vehicle meets all of these criteria it would be regarded as a van rather than a car.

So if i purchase a twin cab hilux such as this one:

http://www.utecanopies.com.au/Images/gallery/large%20images/hilux_05_gse-s.jpg

Is it a mechanically propelled vehicle??? YES

Is it designed or constructed solely or mainly for the carriage of good or other burden???....... It has firm rear suspension so that it can carry 1100Kg of payload in the back so i would argue YES

NO , its has both purposes , the carriage of people and goods, Hence it is not solely constructed or designed for the carriage of goods

Does it have a roofed area or areas to the rear of the driver’s seat??? Not directly behind the drivers seat but as the one in the picture has a canopy over the rear then YES

The canopy is over the load bed, thats irrelevant, the areas behind the driver has side windows

Has no windows or seats in this area??? the one in the picture has tinted windows in the canopy but you can get ones that dont so...... YES

The area being referred to is the area immediately behind the driver , i.e. the back seats

"Where a crew cab or other similar type of vehicle meets all of these criteria it would be regarded as a van rather than a car." YES

But it doesnt

What am i missing here???

The fact that Revenue have ruled on this repeatedly , but hey take the issue to court knock yourself out

jiggajt

BoatMad wrote: »

The fact that Revenue have ruled on this repeatedly , but hey take the issue to court knock yourself out

See comments below: really getting technical now...:D

Originally Posted by jiggajt View Post
Ok, so here is the definition of a VAN for BIK purposes as per revenue themselves. Please correct me if i am wrong in my analysis:


Meaning of “van”
A van means a mechanically propelled vehicle which –
· Is designed or constructed solely or mainly for the carriage of goods or other burden, and
· Has a roofed area or areas to the rear of the driver’s seat, and
· Has no side windows or seating fitted in that roofed area or areas.
Where a crew cab or other similar type of vehicle meets all of these criteria it would be regarded as a van rather than a car.

So if i purchase a twin cab hilux such as this one:

http://www.utecanopies.com.au/Images...x_05_gse-s.jpg

Is it a mechanically propelled vehicle??? YES

Is it designed or constructed solely or mainly for the carriage of good or other burden???....... It has firm rear suspension so that it can carry 1100Kg of payload in the back so i would argue YES

NO , its has both purposes , the carriage of people and goods, Hence it is not solely constructed or designed for the carriage of goods

It says solely OR mainly

Does it have a roofed area or areas to the rear of the driver’s seat??? Not directly behind the drivers seat but as the one in the picture has a canopy over the rear then YES

The canopy is over the load bed, thats irrelevant, the areas behind the driver has side windows

It just says to the rear of the drivers seat. It doesn't say directly to the rear.

Has no windows or seats in this area??? the one in the picture has tinted windows in the canopy but you can get ones that dont so...... YES

The area being referred to is the area immediately behind the driver , i.e. the back seats

Where does it say that?

"Where a crew cab or other similar type of vehicle meets all of these criteria it would be regarded as a van rather than a car." YES

But it doesnt

What am i missing here???

BoatMad

jiggajt wrote: »

See comments below: really getting technical now...:D

Originally Posted by jiggajt View Post
Ok, so here is the definition of a VAN for BIK purposes as per revenue themselves. Please correct me if i am wrong in my analysis:


Meaning of “van”
A van means a mechanically propelled vehicle which –
· Is designed or constructed solely or mainly for the carriage of goods or other burden, and
· Has a roofed area or areas to the rear of the driver’s seat, and
· Has no side windows or seating fitted in that roofed area or areas.
Where a crew cab or other similar type of vehicle meets all of these criteria it would be regarded as a van rather than a car.

So if i purchase a twin cab hilux such as this one:

http://www.utecanopies.com.au/Images...x_05_gse-s.jpg

Is it a mechanically propelled vehicle??? YES

Is it designed or constructed solely or mainly for the carriage of good or other burden???....... It has firm rear suspension so that it can carry 1100Kg of payload in the back so i would argue YES

NO , its has both purposes , the carriage of people and goods, Hence it is not solely constructed or designed for the carriage of goods

It says solely OR mainly

Does it have a roofed area or areas to the rear of the driver’s seat??? Not directly behind the drivers seat but as the one in the picture has a canopy over the rear then YES

The canopy is over the load bed, thats irrelevant, the areas behind the driver has side windows

It just says to the rear of the drivers seat. It doesn't say directly to the rear.

Has no windows or seats in this area??? the one in the picture has tinted windows in the canopy but you can get ones that dont so...... YES

The area being referred to is the area immediately behind the driver , i.e. the back seats

Where does it say that?

"Where a crew cab or other similar type of vehicle meets all of these criteria it would be regarded as a van rather than a car." YES

But it doesnt

What am i missing here???

ah for goodness sake

"· Has a roofed area or areas to the rear of the driver’s seat, and
· Has no side windows or seating fitted in that roofed area or areas."

the roof you refer is not the first roof " to the rear of the drivers seat"
The first roof that is to the rear of the drivers seat , is the areas over the rear seats


"Has no side windows or seating fitted in that roofed area or areas."

it clearly has

Anyway IT doesnt matter revenue have made rulings that these vehicles are treated as full BIK ( anecdotally John Bruton was in a jam , held up by a women driving a tricked up crew cab and he asked his officials how come these vehicles were popular and hey presto the BIK loop hole was closed)

It not up to you to decide, Revenue have ruled on this ( if you doubt me , ask them )

You can of course challenge them in a court case . good lad

jiggajt

BoatMad wrote: »

ah for goodness sake

"· Has a roofed area or areas to the rear of the driver’s seat, and
· Has no side windows or seating fitted in that roofed area or areas."

the roof you refer is not the first roof " to the rear of the drivers seat"
The first roof that is to the rear of the drivers seat , is the areas over the rear seats


"Has no side windows or seating fitted in that roofed area or areas."

it clearly has

Anyway IT doesnt matter revenue have made rulings that these vehicles are treated as full BIK ( anecdotally John Bruton was in a jam , held up by a women driving a tricked up crew cab and he asked his officials how come these vehicles were popular and hey presto the BIK loop hole was closed)

It not up to you to decide, Revenue have ruled on this ( if you doubt me , ask them )

You can of course challenge them in a court case . good lad

Ha! Maybe i will. First roof? Second roof? Plenty of actual vans have either a separate roofed compartment or an integrated cab and storage area.

"Where a crew cab or other similar type of vehicle meets all of these criteria it would be regarded as a van rather than a car."

Why would they mention a crew cab at all in their definition of a van if literally NO crew cab on the market fit this definition??:cool:

BoatMad

jiggajt wrote: »

Ha! Maybe i will. First roof? Second roof? Plenty of actual vans have either a separate roofed compartment or an integrated cab and storage area.

"Where a crew cab or other similar type of vehicle meets all of these criteria it would be regarded as a van rather than a car."

Why would they mention a crew cab at all in their definition of a van if literally NO crew cab on the market fit this definition??:cool:

seriously you need to read the revenue briefing documents on this

http://www.revenue.ie/en/tax/it/leaflets/benefit-in-kind/faqs/company-vehicles.html#car13

A van means a vehicle which was designed or constructed solely or mainly for the carriage of goods or other burden, and which has a roofed area or areas to the rear of the driver's seat and no seats or side windows in that area

a crewcab clearly has a roofed area to the rear of the drivers seat and clearly has seats and side windows in it

A crew cab is NOT a van for the purposes of BIK.

PS I own one

BoatMad

note that a definition of a Van does not in itself absolve you of BIK

The following must also be met

"the van is supplied by the employer to the employee for the purposes of the employee's work,
the employee is required by the employer to bring the van home after work,
apart from travelling from work to home and back to work, other private use of the van by the employee is forbidden by the employer, and there is in fact no other private use,
in the course of his or her work, the employee spends at least 80% of his or her time away from the premises of the employer to which he or she is attached."

jiggajt

BoatMad wrote: »

note that a definition of a Van does not in itself absolve you of BIK

The following must also be met

"the van is supplied by the employer to the employee for the purposes of the employee's work,
the employee is required by the employer to bring the van home after work,
apart from travelling from work to home and back to work, other private use of the van by the employee is forbidden by the employer, and there is in fact no other private use,
in the course of his or her work, the employee spends at least 80% of his or her time away from the premises of the employer to which he or she is attached."

Not trying to get absolved from BIK. Just want to pay the 5% rate instead of the 30% rate.

BoatMad

jiggajt wrote: »

Not trying to get absolved from BIK. Just want to pay the 5% rate instead of the 30% rate.

sure and I want to be regarded as a offshore account holder and be domiciled in monaco :pac:

Sorry about it sunshine, Revenue has acted on foot of a legal change. The matter has been adjudicated on a number of times .

we crew cab people get a raw deal, thanks John Bruton