Tips on reducing your van costs: a focus on tax
January 13, 2017 at 10:56 AM
It is mandatory to tax your van if you are planning to drive it on the roads. Failure to tax your van can result in a fine of £1,000.
However, many van owners find that their van tax costs are mounting and even threatening to become too much for them.
Below you will find a few tips on reducing your van tax costs and thereby reducing the overall running costs of your van.
1. Be careful how you use a company van for private trips
If you use your company's van like a company car - i.e. to make personal trips to the shops or out with friends - you can pay a maximum of £600 annual tax. A way around this is to use your company van wisely. You pay no additional tax if you use it only for what is deemed 'insignificant private use'.
For instance, to commute to and from work each day and to make occasional (but not regular) diversions for personal reasons. For example, if you use your company van to get to and from work every day and then once every couple of weeks or so make a minor diversion to grab something from the shops or to pick the kids up from school, this will not be taxable.
2. Claim your VAT back
If you have a commercial van and your business is VAT registered, you can claim back the VAT on your van as long as your van is used for business purposes (excluding insignificant personal use). If you use your van for regular non-business journeys (e.g. weekly visits to relatives), you cannot claim the tax back on this mileage.
3. Choose the right van for the job
Choosing the smallest, lightest possible van can reduce the amount of tax you pay. This is particularly the case with taxes that are based on emissions rates as these tax bills are calculated according to the engine size of the van and also according to the size of a van. If you have a newer model of van (i.e. one made after 2001) you could save a few extra pounds on your tax too as with older vans emissions taxes are calculated purely by engine size and this generally means that you have to pay more tax.
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