BIK on N1 Commercial 5 Seater Discovery

unklerosco wrote: »

You have to weld in a metal floor, block off seat belt anchors (via welding) and blank off the windows

Maybe you'd have to do some of this retro fitting if the roofed area behind the 2nd row of seats wouldn't qualify as being sufficiently large to define the vehicle as being mainly for carriage of goods or other burden but large modern SUVs like the Pajero, Disco, Land Cruiser and Touareg the roofed area behind the 2nd row of seats is big enough for such vehicles to be certified N1 Commercial vehicles.

Also, if the car companies advertising these vehicles as N1 commercials subject to €333 road tax etc are wrong why haven't the advertising standards authority taken them to task for false advertising?

Je_suis_Jean wrote: »

Also, if the car companies advertising these vehicles as N1 commercials subject to €333 road tax etc are wrong why haven't the advertising standards authority taken them to task for false advertising?

Because they are classed as N1 and entitled to the €333 road tax.. explaining it to the guards at a checkpoint with your missus n kids in the back is the challenge.

The N1 classification is an EU classification, how revenue class it for BIK etc. is they're choice (that's my take on it anyway). EU ruling states

Category N1 - a vehicle that, at all stages of manufacture, is classified as a category N1 vehicle with less than 4 seats, and has, at any stage of manufacture, a technically permissible maximum laden mass weight that is greater than 130 per cent of the mass in service of the vehicle with bodywork in running order

http://www.revenue.ie/en/tax/vrt/revised-vehicle-classification.html

Marcusm wrote: »

Your position is quite amusing; you don't want to be associated with "plumber" types by driving a van type vehicle

Pretty arrogant start to the day there Marcusm, perhaps you do need to get back in the thin blue tube and employ your intellect in a positive manner. BTW, I'm not a plumber so why would I want to project the image of a plumber? I've nothing against plumbers, one of my best friends is a plumber and I happily associate with him. I'm not a snob and resent the inference.

Marcusm wrote: »

you ... seem to have no interest in its load carrying capacity other than as a vehicle to transport suitably impressed clients on an infrequent basis and yet you want it to be classified as a "van"; precisely the thing whose association you want to avoid.

Not true. I do have to carry tools and other equipment to facilitate my profession, carrying clients is also one of the functions I require the vehicle for. Tomato sauce is classified as a vegetable by US congress in order to appease lobbying from pizza manufacturers. This is a tax issue and nothing else. For tax purposes only I am exploring whether the regulations allow me to classify a premium SUV as a "van". Nothing more and nothing less. Corporates have swathes of professionals dedicated to minimising the tax they have to pay via avoidance not evasion. Why should a small business be any different?

Marcusm wrote: »

You may want to call it a swan but it walks and quacks like a duck.

Thankfully the qualifying criteria set out in the guidance issued by revenue is not that simplistic, it leaves a lot of room for interpretation which the car companies and business owners are using to their advantage. If revenue get their act together and remove the ambiguity by for example inserting the term "immediately behind the drivers seat" into the definition of a van it would close the potential for 5 seat SUV's to be certified N1 commercials and it would effectively put this issue to bed but they choose not to.

Marcusm wrote: »

As this is the TAxation forum, it is perhaps better to bring some sanity back to proceedins and commence referring to the law rather than to Revenue guidance. There is specific legislation setting out the basis on which BIK is charged on a car. Outside of that arena, issues with respect to the valuation of the benefit are dealt with by Revenue practice and governed by the case of Pepper v Hart.

For the purposes of BIK in Ireland, a "car" is defined as follows

“car” means any mechanically propelled road vehicle constructed or adapted for the carriage of passengers, other than a vehicle of a type not commonly used as a private vehicle and unsuitable to be so used;

Now; how do the readers of this forum consider whether a 5 seat Touareg, Disco etc would fit within this definition.

Pepper v Hart (65 TC 421) is reference in this analysis of BIK by CPA Ireland http://www.cpaireland.ie/docs/default-source/media-and-publications/accountancy-plus/taxation/pay-e-a-n-d-p-r-s-i.pdf?sfvrsn=2

You will see in the analysis there is the following exclusion

Exclusions

PAYE/PRSI does not apply to the following benefits provided/paid for by the employer:

1. A welcome concession has been made for the private use of company vans, where the following conditions are 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 no other private use; and,

* in the course of his work, the employee spends at least 80% of his time away from the premises of the employer.

So what is a "van"? We're back to the same question

You are of course correct that the legislation defines a car as “a mechanically propelled road vehicle constructed or adapted for the carriage of passengers, other than a vehicle of a type not commonly used as a private vehicle and unsuitable to be so used.”, see http://www.revenue.ie/en/about/foi/s16/income-tax-capital-gains-tax-corporation-tax/part-11/11-00-01.pdf but you will also see within the same legislation https://www.google.ie/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&uact=8&ved=0ahUKEwjOzt-O04bNAhVDLMAKHTdMB4kQFgghMAA&url=http%3A%2F%2Fwww.revenue.ie%2Fen%2Fabout%2Ffoi%2Fs16%2Fincome-tax-capital-gains-tax-corporation-tax%2Fpart-11%2F11-00-03.pdf&usg=AFQjCNFRgngkDJzm-4qWX-T3e0KH_IM0Aw&sig2=f9MZXwd9JhXf6wkR-yTneQ&bvm=bv.123325700,d.ZGg there is a heading "Certain Commercial Vehicles" (notice the helpful use of the term "Commercial" ) which states that "Essentially, only private cars are subject to the restrictions and a commercial vehicle that is constructed or adapted for the carriage of goods or passengers is not subject to the restriction notwithstanding that it may be used for private purposes. However, with certain types of vehicles, for example, 4 x 4 and jeep-type vehicles, it may be difficult to determine whether the vehicle is a commercial vehicle." You gotta love that ambiguity, the more the merrier.

So we've gone full circle. Ignoring your childish patronising comments ref not wanting to be associated with a plumber in a van it seems there is plenty of room to assert that Commercial Vehicles (which are certified by Revenue themselves as N1) are not deemed to be cars for tax purposes and are effectively treated as..............wait for it............ vans

Thanks (primarily) to you I now have a substantial amount of revenue produced documentation which will be printed out and kept in the glove box of my 5 seat commercial SUV to be pulled out and used to justify why no BIK should be levied on my business use of the car van. Maybe it will work, maybe it won't but there is plenty of scope to make the argument and to highlight the ambiguity in legislation and revenue guidance on the matter.