Is a Land Rover Discovery a car or a van? Can a modified version of a vehicle make it unsuitable for private use?
In the case of Timothy Jones v HMRC [2012] TC01958 an employed mobile motor technician was provided with specially modified Land Rover Discovery for roadside recovery. HMRC treated it as a car and his tax code reflected car benefit. He appealed against his tax coding on the basis that it was not a car.
The technician knew that under a previous agreement with HMRC, such vehicles were not treated as cars. That agreement had long since ended and HMRC did not agree this concession with his new employer.
The Tax Tribunal found that:
“The entire boot area of the Land Rover was filled with racking and tool boxes which are bolted to the structure of the vehicle. In addition, although the rear seats and seat belt fittings are in place the seats are impossible to use as extra tool boxes have been securely fixed over them. Mr Jones explained that when he was employed by Mondial it had been possible to use the rear seats of the Land Rover but extra tool boxes had been fitted to the vehicles provided by the AA. Although it was technically possible for these to be removed, he is not permitted to do so by his employer.”
“The modifications to the vehicle also include additional lighting, electrics and special control systems. Despite these modifications taking two days to fit using special lifting equipment and the services of trained electricians there is no fundamental alteration to the structure of the vehicle. This is because it has to be returned to Jaguar Land Rover for re-sale after one year when it is replaced by a new vehicle.
The technican accepted that a Land Rover is a mechanically propelled road vehicle that it is not a motor cycle, invalid carriage or a vehicle of a type not commonly used as a private vehicle and not suitable for such use. So, unless it was a “goods vehicle” it must be a car according to s115(1) ITEPA.
A “goods vehicle” is defined by s115(2) ITEPA as “a vehicle of a construction primarily suited for the conveyance of goods or burden of any description”.
The Tribunal decided that although the Land Rover Discovery supplied may have become primarily suited for the conveyance of goods or burden, this was as a result of modifications which were made to the vehicle so as not to fundamentally alter its structure, and not because it was “of a construction” for such a purpose.
Comment
There was the potential for arguing that a vehicle with those type of modifications is “not commonly used as a private vehicle and is not suitable for such use”. This would be on the basis that the modification made the Land Rover into a type of vehicle not commonly uses as a private vehicle and their nature made it unsuitable for private use. Not being able to take passengers or shopping is surely pretty fundamental to use. In this case, although it would have taken considerable effort to remove the modifications the rear seats remained intact and it could be changed back into a private car.
There is a lot of case law on this, but it is worth looking through HMRC's Employment Income Manual (para EIM23140) it says “the fact that a car has been modified in some way will not make it either illegal or unsuitable for use as a private vehicle. In particular, the fact that a car is usually kept loaded with goods or equipment does not mean that it is unsuitable for use as a private vehicle if all that is necessary to make it suitable is to unload the items in question.”
