PICK-UP VAT RECLAIM EXPLAINED: WHAT UK BUSINESSES MUST KNOW IN 2025
There’s been a lot of talk about tax changes this year, especially around double and extended-cab pick-ups. If you’re running a business and use a vehicle like the KGM Musso, here’s the good news: nothing has changed when it comes to VAT.
In April 2025, HMRC updated the rules on how double and extended cab pick-ups are treated for Personal Benefit-in-Kind (BIK) tax, capital allowances, and business profit deductions, reclassifying them as company cars. But what a lot of people don’t realise is that the VAT rules have stayed exactly the same.
That means if your pick-up has a payload of over one tonne (which all Mussos do), and your business is VAT-registered, you can still claim back the VAT in full and benefit from £345 first year VED (road tax), just like before.
The backstory
From 6 April 2025, any new double or extended-cab pick-ups registered will now be taxed like a passenger car for personal BIK. This means the BIK rate is based on CO₂ emissions.
But there’s a transitional period in place. If you ordered, bought, or leased your pick-up before 6 April 2025, you’ll still be taxed under the old rules – the flat commercial vehicle rate – until 5 April 2029, the end of your lease, or when you get rid of the vehicle, whichever comes first.
Capital Allowances have also changed. From 1 April 2025 (for corporation tax) and 6 April 2025 (for income tax), double and extended cab pick-ups are no longer classed as “plant and machinery”. Instead, they’re treated like company cars. That means the tax relief you can claim depends on the vehicle’s CO₂ emissions – 6%, 18%, or 100% for zero-emission vehicles.
VAT Still Reclaimable on Musso
There’s no change here. If you use a Musso for business and your company is VAT-registered, you can still reclaim the VAT. That applies to every model in the Musso lineup. Plus, the VED continues at the commercial vehicle rate of £345 per year, keeping running costs low for business owners.
So, to be clear, the new HMRC changes only affect things like Personal BIK, Annual Investment Allowance (AIA), and other business tax deductions, not VAT. Nothing has changed on the “VAT front”, so there’s no need to worry.
Why choose the Musso?
The Musso is a proper workhorse. It can tow up to 3.5 tonnes and carry more than a tonne in the bed. With a class-leading gross train weight of 6,450 kg for the manual Rebel, 6,750 kg for automatic versions, and an impressive 6,900 kg for the Saracen+ variant, our Korean-built powerhouse offers the highest total load capacity of any pick-up available in the UK.
This is thanks to the 2.2-litre e-XDi220 engine under the bonnet, which delivers 202 PS and 441 Nm of torque. This proven KGM-built engine offers smooth, progressive acceleration from a standstill and strong low-end torque, making it perfectly suited for tough work and everyday driving.
Plus, it’s built on a body-on-frame chassis, has selectable four-wheel drive, and all the comfort and tech features to make those long days easier. So, if you’re looking to upgrade your work vehicle or expand your fleet, now’s a great time. You’ll still be able to reclaim the VAT, and you’ll get a pick-up that’s built to last.