Company van agreement

No taxable benefit in kind arises from making a company van available to an employee if they are not entitled to use it for private journeys and do not actually do so. To avoid the benefit you make an agreement with or set a policy for the employee stipulating this.

Commuting and private travel

Unlike the position for company cars, ordinary commuting (travel between home and a normal place of work) counts as a business journey when made in a van provided by an employer. However, if there is any other private use of the van the benefit in kind is triggered unless the private use is incidental or insignificant. Tax legislation doesn’t define “insignificant”. HMRC’s view is that it would not be for more than a few days at most over the whole tax year, and not for a number of consecutive days. Essentially, it would be the exception in terms of the pattern of use.

 Agreement

To avoid the van benefit you should prohibit private use (apart from commuting) of a company van. Use our Company Van Agreement to ensure the correct wording to achieve this.