Double Cab Pick-Up Tax Change: End of the Road for 100% Relief?

If your business relies on double cab pick-ups (DCPUs) — whether for transporting tools, people, or products — then major tax changes coming in April 2025 could affect your bottom line more than you realise.

Until now, DCPUs have often been treated as vans for tax purposes, giving businesses access to generous capital allowances, tax deductions, and favourable benefit-in-kind treatment for employees.

But from April 2025, that all changes.

Here’s what’s happening, who’s affected, and how you can still act before the cut-off.

What’s Changing?

From 1 April 2025 (for companies) and 6 April 2025 (for sole traders/partnerships), newly acquired double cab pick-ups will be treated as cars, not vans, for both benefit-in-kind and capital allowance purposes.

Why it matters:

Previously, many DCPUs:

 Qualified for 100% capital allowances in the year of purchase (via the Annual Investment Allowance or full expensing for companies)
 Were excluded from the more restrictive tax treatment that applies to cars
 Offered lower tax charges for employees using them privately

Now, under the new rules:

 No more 100% upfront tax deduction — instead, cars are only eligible for:

• 18% writing down allowance (main pool), or

• 6% for high-emission vehicles (special rate pool)

Leasing DCPUs? There’s Another Hit

From April 2025, leased DCPUs with emissions over 50g/km will trigger a 15% disallowance on the rental expense.

Worse still, from 1 October 2025, this disallowance will apply to all DCPU leases, even those that started before the rules changed — a rare retroactive adjustment that could affect ongoing leasing arrangements.

Transitional Relief: A Limited Window to Act

There’s still an opportunity to lock in the current, more favourable tax treatment — but you need to act soon.

To qualify under the old rules:

• A contract to acquire the DCPU must be signed before 1 April 2025 (companies) or 6 April 2025 (income tax traders)

• The expenditure must be incurred (i.e. the vehicle delivered and paid for) by 1 October 2025

If both conditions are met, the DCPU will still be treated as a van, allowing 100% relief in year of purchase.

Real-World Example

Example: Smith Building Ltd
Smith Building regularly purchases DCPUs for supervisors and foremen, usually reclaiming full capital allowances in the year of purchase — worth £10,000–£15,000 in tax savings per vehicle.

• Under the new rules, a £35,000 DCPU purchased in May 2025 will only qualify for an £6,300 deduction in year 1 (18%)

• If leased, and over 50g/km emissions, 15% of the lease cost will be disallowed, reducing the tax benefit of leasing

Multiply that across several vehicles, and the lost relief could be in the tens of thousands — even for small firms.

Key Impacts by Business Type

What Should You Do Now?

Review your fleet strategy: If you’re planning to purchase or lease a DCPU, aim to complete the transaction before April 2025 and ensure delivery/payment by October.

Reassess leasing vs buying: The new 15% disallowance on high-emission leases makes ownership more attractive in some cases.

Explore alternatives: Depending on use, a van or low-emission vehicle may now offer better tax value.

Speak to your accountant: This is a classic example of tax law hitting operational decisions — you need a plan tailored to your business.

Merranti Can Help You Beat the Deadline

We’ve already helped clients:

• Secure pre-April contracts for qualifying DCPUs

• Calculate the real cost difference under new rules

• Identify vehicles that will retain van status

• Adjust leasing plans to minimise disallowances

Don’t let a tax reclassification drive up your fleet costs. Let Merranti help you navigate the road ahead.