UK & Ireland Ineos Grenadier and UK HMRC BIK classifications for 2 and 5 seat Commercials

[Jeremy996]

I asked Gary Pearson of Ineos Automotive for his comments and they are posted in the thread "The Grenadier, HMRC and DVLA" in the United Kingdom forum

 

[Tom D]

It does seem unlikley that IG will get HMRC to recognise any 5 seat variant as commercial. The two seat one ought to be in my opinion.
I spoke to my accountant today for some re-assurance and he was pretty relaxed about the pool car status given our usage and situation. I’ll report back once i have confirmation ,(he was off to do some research)

 

[jamesfielding]

Michael, so have you gone for the 5 seat or 2 seat variant ? I went 2 seat so it it very much like the defender hardtop which I use and is ok with being Bik. Cheers Olly.

Hi Oliver , with the information that the grenadier doesn’t meet HMRC specs are you keeping your order / higher rate BIK?

 

[Lancs Lad]

I asked Gary Pearson of Ineos Automotive for his comments and they are posted in the thread "The Grenadier, HMRC and DVLA" in the United Kingdom forum

Thanks Jeremy, Good to get it from the Horses mouth, sadly that's killed it for me as a 5 seat commercial was vital to me.
We've at least got some proper engine'd pickups arriving this year again...

Enjoy the vehicles folks...

 

[Spjnr]

Thanks Jeremy, Good to get it from the Horses mouth, sadly that's killed it for me as a 5 seat commercial was vital to me.
We've at least got some proper engine'd pickups arriving this year again...

Enjoy the vehicles folks...

As long as your not referring to the Ford Ranger V6, with the Ford/Peugeot lion 3.0... apparently its got a strengthened crankshaft now, but why they didn't just use VWs 3.0tdi is a mystery!

 

[Lancs Lad]

As long as your not referring to the Ford Ranger V6, with the Ford/Peugeot lion 3.0... apparently its got a strengthened crankshaft now, but why they didn't just use VWs 3.0tdi is a mystery!

lets see who has the last laugh

 

[Lancs Lad]

OK "dealer" must have heard me...he called today chasing for an order...told him the sad news..
Its obviously a hot potato and subject of internal zoom sessions apparently. He tried to talk me out of it but I'm not taking the risk...

I'm still on the list for the first road run of the utility when it arrives with him in next week or two...but that will be simply torture..

 

[Stu_Barnes]

Man that’s rough. Sorry to hear it @Lancs Lad

 

[Lancs Lad]

Man that’s rough. Sorry to hear it @Lancs Lad

yeah absolutely gutted...just sad my current situation dictates it had to be a commercial 5 seat.

Things will change and im watching with interest. High time UK looked at its ancient pathetic weight laws.

If it helps anyone i was also told if ordered quick I'd get a May Build slot and delivery July. starting April he's expecting approx 30 a month.
also confirmed UK customers will get their vehicles first with his first two customer cars due next week.

 

[caalm]

I dont think you’d get away with that in this day & age, HMRC are so switched on - if you get caught out via an audit you’re in a whole world of hurt.
tax laws in uk are rubbish.

Then you'd get hit with a sht tonne of fines
I've told Ineos to give me a definitive answer....if it's not classed as a commercial by the HMRC then I'll have to cancel....I'm not paying £19k a year plus more expensive fuel.

 

[Jeremy996]

Then you'd get hit with a sht tonne of fines
I've told Ineos to give me a definitive answer....if it's not classed as a commercial by the HMRC then I'll have to cancel....I'm not paying £19k a year plus more expensive fuel.

Check the thread I pinned in the UK section. The Ineos view is you need to check with your accountant as Ineos does not give tax advice. The 2 seat Utility will probably be accepted as a commercial vehicle, but the 5 seat versions will not. The only effective alternative is use as a "Pool Car".

 

[LaurasOtherHalf]

The 2 seat Utility will probably be accepted as a commercial vehicle

Having talked with some more people, I'm not convinced even this will be the case-I was told explicitly NOT to take any previous Land Rover models as examples that anything else similar would be allowed through. The insinuation (not offered with proof) was that JLR had lobbied government on this very subject as a bonus to manufacturing in UK type of deal.

 

[Jeremy996]

The insinuation (not offered with proof) was that JLR had lobbied government on this very subject as a bonus to manufacturing in UK type of deal.

I'd be astonished if that wasn't the case! (Although notably, the vehicle most likely to have benefitted, the 110 van has many of the same problems as the Grenadier - too heavy and was not built in the UK).

Ineos have not done any lobbying yet, as per Gary Pearson, they were waiting for homologation. The precedent will resonate with the law lords, even if it doesn't with our political masters, but being right could be long and expensive.

 

[CountyV8]

How difficult can it be HMRC ? If you have rules it is is or isn't dos or doesn't .

 

[Adam]

Well if I can't claim the VAT back my 5 seat commercial (in the first 4 my dealer is getting) will be for sale. At least I think they will trade at a premium .

 

[JonSutton]

Seems pretty straightforward to me. If a car or a commercial vehicle is business use only all the VAT is recoverable by a properly registered business (its’ not always been this way). That means that if the Grenadier is classed as a car by HMRC you can still recover the VAT if usage is business only. The tricky bit is being able to demonstrate no private use. That’s where the pool car type is sometimes created to mask the real use or where the car is genuinely a pool car. Salary sacrifice for car operating costs might also be an option for some businesses.
Trickier still because for a lot of us with smaller own businesses the vehicle is also a lifestyle choice. For me I keep it simple. I buy the vehicle and charge business use to my business, I suffer no BIK and that way I get no challenge from HMRC, but do also suffer if I rack up heavy mileage. The official mileage rates also need updating for current fuel and running costs.

Vehicle disposal is also simple, no VAT to deal with but if the vehicle suffers heavy depreciation you pay, but if I’d put it into my business the business would pay, though it’s still my money so I take the cash hit either way. The Grenadier should suffer quite light depreciation so overall costs should be acceptable for what is an expensive vehicle. Defo better than a Range Rover.
I spent my working life in leasing - VAT and BIK important in the UK with the company car/perk position, total cost of ownership more important elsewhere. It’s is not a good plan to give HMRC a reason to investigate you.

 

[CountyV8]

Seems pretty straightforward to me. If a car or a commercial vehicle is business use only all the VAT is recoverable by a properly registered business (its’ not always been this way). That means that if the Grenadier is classed as a car by HMRC you can still recover the VAT if usage is business only. The tricky bit is being able to demonstrate no private use. That’s where the pool car type is sometimes created to mask the real use or where the car is genuinely a pool car. Salary sacrifice for car operating costs might also be an option for some businesses.
Trickier still because for a lot of us with smaller own businesses the vehicle is also a lifestyle choice. For me I keep it simple. I buy the vehicle and charge business use to my business, I suffer no BIK and that way I get no challenge from HMRC, but do also suffer if I rack up heavy mileage. The official mileage rates also need updating for current fuel and running costs.

Vehicle disposal is also simple, no VAT to deal with but if the vehicle suffers heavy depreciation you pay, but if I’d put it into my business the business would pay, though it’s still my money so I take the cash hit either way. The Grenadier should suffer quite light depreciation so overall costs should be acceptable for what is an expensive vehicle. Defo better than a Range Rover.
I spent my working life in leasing - VAT and BIK important in the UK with the company car/perk position, total cost of ownership more important elsewhere. It’s is not a good plan to give HMRC a reason to investigate you.

It’s is not a good plan to give HMRC a reason to investigate you. Ditto

 

[Adam]

Well Jon I hope you're right. I run two pick ups in one company and the grenadier will be in another. I also run a disco 4 which is just for private use so the others are purely company. I always think if I do the odd private journey in the pick ups I also do quite a few work ones in the Disco for which the is no company claim so I thin it evens out.

 

[JOB]

At least I think they will trade at a premium .

When 90% of the target market want to buy and run through their business, you really think when they realise this blunder there will be sufficient demand for them to trade over odds? Hmm....

 

[chriscroft]

I have spent some time trying to understand this by talking to professionals, but it could be wrong

For a limited company, and only a limited company. (i.e, not a sole trader/partnership - this is different)
I have been told by my accountant who is a director of 100+ staff. He can make a mistake but they have been generally been very good in 30+ years we've used the company. But he could be wrong.

That for a 5-seater N1 Commercial
So long as I use it for some significant business use I can have the Capital allowances, because it is a Van N1; it was an M1 car I couldn't claim any capital allowances under current rules in most circumstances.

I may not be able to claim all the 20% Vat back because this should be prorated i.e if use it for 50%business; 50%non-business then I should only claim 1/2 the Vat back i.e 20/2= 10% of the VAT. But you have to pre-guess the usage split.

If I just once used the vehicle in that tax year for personal use, I would be due all the BIK liabilities for that tax year....But that could be split if 2 of us used it in that tax year. So long as both pay 1/2 the BIK each (or prorated)- i.e HMRC gat their full BIK somehow. The company does pay the BIK, do.
The N1 commercial treatment is different to an M1 car for a limited company. But you have to be fair and honest about this with HMRC.

But if you really never ever use the vehicle for BIK personal use; then BIK doesn't apply.

Please don't shout at me....