Coca-Cola loses company car tax ruling in Court of Appeal


Legislation defining the tax treatment of when a vehicle is a van or a company car has been labelled outdated, unclear and not fit for purposes by tax experts.

It follows the latest instalment in a long-running court case involving HMRC and Coca-Cola around whether three commercial vehicles (two Volkswagen Kombi vehicles and one Vauxhall Vivaro) operated by the drinks firm should be classified as vans or cars for benefit-in-kind purposes.

Back in August 2017, a First Tier Tribunal (FTT) ruled that although the two modified Volkswagen Kombi T5 vehicles were originally classed as vans for tax purposes, once it considered the characteristics of the vehicles as provided to the employee – and not just at construction – they were actually cars

It, however, ruled the Vivaro operated by Coca-Cola was a goods vehicle as it was “primarily suited to the conveyance of goods”.

Legislation states that a van must be a goods vehicle, defined as a vehicle of a construction primarily suited for the conveyance of goods or burden.

Appeals were lodged with the Upper Tribunal (UT) by both HMRC and Coca-Cola, with HMRC disputing the decision of the FTT on the Vivaro and Coca-Cola on its Kombi ruling.

It upheld the original decisions made by FTT, publishing its decision last year.

However, after both appealed the decisions again, this time to the Court of Appeal, it has now ruled in favour of HMRC, deciding that the Vauxhall Vivaros should now also be classed as company cars, not vans, by Coca-Cola. 

The drinks firm lost its appeal on the Kombis, with the three Court of Appeal judges agreeing with the FTT and UT decisions.

Company car tax expert, Alastair Kendrick, told Fleet News: “This finding demonstrates that the legislation is out of date and not fit for purpose.” 

He says it’s surprising that HM Treasury still has not revised the legislation to take account of the advent of so-called ‘combi’ vehicles.

“It is disappointing that despite it being sometime…



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