Double Cab Pickup Owners Now Face a 400 Percent Company Car Tax Rise

Thousands of drivers who use a double cab pickup as a company vehicle are now paying up to four times more tax than they did before HMRC reclassified these vehicles as cars. The change took effect in April 2025, but its full force is only landing on drivers now, as older vehicles with transitional protection are traded in and replaced with new ones taxed under the harsher rules.

From flat van rate to a sliding car scale

For years, double cab pickups with a payload of one tonne or more got the same tax treatment as a works van, regardless of how expensive or powerful the model was. A driver in a basic, no-frills pickup and a driver in a top-spec model costing tens of thousands of pounds more paid an identical flat benefit-in-kind charge, as both were classed as commercial vehicles rather than cars.

That changed under rules announced in the Autumn Budget 2024 and brought into effect from 6 April 2025. Double cab pickups with a payload of one tonne or more are now treated as cars for benefit-in-kind, capital allowances and profit deduction purposes. Instead of a flat van rate, tax is now calculated using the same sliding scale applied to ordinary company cars, based on CO2 emissions and the vehicle’s list price, with bands running from 2 percent up to 37 percent of that value.

For a heavy, powerful pickup with a high list price and high emissions, that shift pushes the taxable benefit-in-kind figure sharply upward. GB News reported drivers facing tax increases of up to 400 percent once their vehicle moved onto the new car-based bands, turning what used to be one of the most tax-friendly vehicles a tradesperson or company driver could choose into one of the least.

Who actually pays the bill

The cost lands in two places. Employees who have a double cab pickup as a company vehicle now pay income tax on a benefit-in-kind value calculated the same way as for a car, rather than the old fixed van figure. Employers, meanwhile, pay Class 1A National Insurance contributions on that same higher value, which means the tax rise hits both the driver’s payslip and the employer’s costs at once.

Farmers, builders, landscapers, and tradespeople who chose a double cab pickup for combining a workhorse load bed with a comfortable, tax-friendly family vehicle are the group most affected. Many bought these vehicles under the old rules precisely for that reason: a single pickup could double as both a work tool and the family car, at a tax cost that made sense for a small business. That calculation now looks very different.

The transitional relief window has narrowed

HMRC did build in some protection when it announced the change. Employers that purchased, leased, or ordered a double cab pickup before 6 April 2025 can continue using the old, more favourable van-based tax treatment until the earliest of the vehicle being sold, its lease ending, or 5 April 2029.

That transitional window is now closing in practice. Any driver replacing an existing pickup, or any business ordering a new one for the first time, faces the full car-based tax charge immediately, with no phase-in period. As leases from 2024 and early 2025 reach their natural end over the coming months, more and more drivers are moving off the protected old rate and onto the new one, which is why the financial impact of a change announced over a year ago is only now being felt widely across driveways and depots.

VAT treatment has not changed. Double cab pickups with a payload over one tonne still qualify for VAT reclaims for VAT-registered businesses, in the same way they always have. It is only the income tax, National Insurance and capital allowances treatment that has shifted onto the car-based system.

What drivers and small businesses can do

Anyone still covered by the transitional arrangement should check the exact date their protection ends. It is tied to disposal, lease expiry or the April 2029 cutoff, whichever comes first. Extending an existing lease slightly, where the leasing company allows it, can sometimes buy extra months on the old, cheaper rate before the higher charge kicks in.

For anyone buying a new commercial vehicle now, it is worth running the numbers on alternatives before assuming a double cab pickup remains the tax-friendly choice it once was. Single cab pickups and panel vans with genuine commercial specification are not affected by the reclassification and retain the old flat van benefit-in-kind rate, which could suit businesses that do not need rear passenger seats as a daily requirement.

Electric and low-emission pickups sit at the bottom of the new car-based tax bands, so a business comparing its options could find that going electric, where a suitable model is available, softens the blow considerably compared with a high-emission petrol or diesel equivalent. An accountant or fleet consultant can run the specific benefit-in-kind figures for a given model and salary, as the actual tax bill depends heavily on the individual vehicle’s list price and CO2 rating rather than a single flat percentage.

Businesses that rely on pickups for genuine haulage work, rather than as a dual-purpose family vehicle, should also check whether HMRC’s separate criteria for classifying a vehicle as a van rather than a car still apply to their specific model and configuration, as manufacturers have adjusted specifications on some pickups in response to the rule change.

The numbers behind the headline figure

To see how the 400 percent figure arises in practice, take a high-spec double cab pickup with a list price around £50,000 and CO2 emissions typical of a large diesel engine. Under the old flat van benefit-in-kind rate, a driver in the 2024/25 tax year paid tax on a fixed figure of a few thousand pounds regardless of the vehicle’s price or emissions. Under the new car-based bands, that same vehicle’s CO2 output places it near the top of the scale, at 37 percent of its £50,000 list price. That pushes the taxable benefit-in-kind figure past £18,000, several times higher than the old flat rate, before income tax is even applied on top.

The exact multiple varies by model, trim level and engine, which is why some drivers report smaller rises and others report the full 400 percent jump GB News highlighted. A lower-priced, lower-emission pickup will move up the scale by less than a top-spec model loaded with extras and a larger engine, so two drivers in different versions of the same badge can face very different tax bills under the identical set of rules.

An industry reaction that did not stop the change

Pickup owners and industry bodies pushed back hard when the reclassification was first announced, and for a brief period it looked as though HMRC might reverse course entirely. An earlier attempt at a similar reclassification, made in 2024 under different guidance, was withdrawn within days after a public outcry from tradespeople and farming groups who argued it would penalise workers who truly need a load-carrying vehicle with rear seats for a small crew.

The version that eventually took effect from April 2025 survived that pressure and reached the statute book largely unchanged, even as vehicle leasing companies and trade bodies representing the agricultural and construction sectors kept raising objections. Isuzu and other pickup manufacturers ran promotional campaigns in early 2025 encouraging buyers to place orders before the 6 April deadline specifically to lock in the old tax treatment, a clear sign the industry expected the change to bite hard once it landed.

Two years on from the original Budget announcement, that bite is now being felt in earnest, as the last wave of pre-deadline orders reaches the end of its protected period and a new generation of pickups rolls onto driveways taxed at the full car rate from day one.

Sources:

• GB News: HMRC car tax update sees drivers face 400% hike in costs
• GOV.UK: Autumn Budget 2024 overview of tax legislation and rates