BIK Van to son

Poodle

Hi help please, the situation is this.

A son is the employee of his fathers small plumbing company. The son has a company van. The place of work is the fathers home, son lives 80 miles away from father and travels to fathers home on a Monday morning and then stays with father in the week and returns home on a Friday afternoon after work, in the van.

The son puts all fuel into the van and when reimbursed for this by the company he is deducted an amount equating to 30p per mile for private use of the vehicle 160 miles.

Whilst staying with the father in the week no private use of the van is allowed the vehicle is parked at the house in the evenings and used in the day only on a jobbing type of work.

Any help with the BIK side of this would be appreciated I was thinking to put the van and fuel as fully reportable on a P11d less the weekly contribution for private use. Since no private use is allowed Tuesday to Thursday could I deduct 3 days a week off as being not available for private use?

Also for one week a month the son is on call 24/7 from his home, could a further deduction for non availability be offset for that?

Should I get a dispensation for this? do I need to if mileage records are kept?

Any suggestions would be most welcome.

Thank you

Poodle

Any help appreciated

Hi,

Does anyone have any thoughts on this payrollpro, TC? I will contact HMR&C if not.

Thank you

Julia

deanshepherd

Commuting to and from work is considered a business journey in a works van.

Presumably the son uses the van privately at the weekends? Other than for minor and occasional use?

If not, then there will be no van benefit at all.

Poodle

Hi Dean, thank you for the response.

The van is available for use at the week-end being parked at the sons house. However the son does have his own car that he uses at the week end.

I must have missed the fact that commuting to and from work is not private use if it is done in a works van, I always thought that it was private use. Any idea when it changed? The sons place of work is not his home, only when he is on call.

Julia

deanshepherd

Van rules have always been different from car rules.

The fact that it is 'available for private use' has no bearing on a van either.

HMRC accept that it is not feasible or desirable for a company to keep all their vans on company premises and have their employees drive to and from work every day to collect their vans and leave their cars on the company premises all day, hence why the commute is not considered non-business and neither is 'availability' outside of working hours.

For a belt and braces approach, I would probably want something in writing from the company to state that he is not allowed to use the van privately without permission and even then only for minor and occasional reasons; although that is not strictly necessary.

It is usually just a matter of establishing the facts. He either uses it privately on a regular basis (i.e. to go shopping) or he doesn't.

PGM

Very interesting Dean, you'll be rivaling Steve for title of supreme accountant!!!

deanshepherd

Steve is Premiership. I'm merely a pub player..

Bluewednesday

deanshepherd wrote: »

Steve is Premiership. I'm merely a pub player..

HAha haha ha, Steve for accounting knowledge and Dean for tax!

payrollpro

Dean is right the calculation is different. What HMRC expects your client to do is have records of the mileage. The total business travel, plus all commuting is deducted from the total for the year and then you have to make a judgement on the balance, if there is any.

Should you determine that the balance is marginal it comes under the heading of incidental private use, otherwise the van is reportable in full. I would ignore the individual detail and work it out from the totals as it is much easier and i think you'll find in this case it's all covered.

It's all about records though and in my experience employers and employees will not keep records of a van's journeys and if they don't it will be nigh on impossible to argue that it is all compliant.

Payrollpro

PGM

A company policy that the van can't be used for private use will help argue the cause. And then how strickly the policy is inforced is an entirely other matter!

PGM

Bluewednesday wrote: »

HAha haha ha, Steve for accounting knowledge and Dean for tax!

And I'll stick with my management accounts side..