Overview
- HMRC said it is considering an SMMT proposal to reduce the payload test for electric double-cab pick-ups so more models can qualify for VAT recovery.
- Under current rules, a pick-up must carry at least one tonne to be treated as a van for VAT, but heavy EV batteries often cut the usable payload below that mark.
- Businesses could reclaim close to £8,000 in VAT on some models if the rule changes, with the KGM Musso EV used as an example in coverage.
- Officials have not made a decision and warned there is no guarantee the rules will change.
- Since April 2025 most double-cab pick-ups count as cars for Benefit-in-Kind tax, creating a mismatch with VAT rules, and some EVs already pass the one-tonne test while others do not.