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If you have a personal van, you might be thinking of all of the ways you can use it to earn some extra money. It could be through delivery courier services, removals, or as storage for construction and handiwork.
However, before you set off on your next employment venture, you will need to consider a couple of things to make sure you’re covered.
Specifically, those things are the insurance and tax implications you will need to consider.
Insurance
If you choose to start using your vehicle for work, then you’ll need to notify your insurance company as the use of your vehicle will have changed from personal to business use.
It may be that your insurance company decides that the new use of your vehicle poses no extra risks so will write a policy that outlines the vehicle as ‘private with occasional business use’. Or, they may require you to take a different level of insurance policy- depending on the overall use, what you will be using it for, and where you will be driving the van.
Not being insured to the correct level could lead to potential fines and points added to your licence–the same will go for employers if they are knowingly under-insuring a business vehicle. This could also mean that insurance companies may refuse to pay out for a claim if a vehicle is being used for work, but not insured for work purposes.
Vans that are being used for work are more at risk of being involved in an accident. The reason for this is because of extra mileage, and a greater risk of break in.
If you want to know more about van insurance, specifically: find out more, here.
The second thing you will need to consider if you start using your personal van for work purposes is:
The Tax Implications
If you are an employee
If you use your own vehicle when you’re employed, you’re entitled to be reimbursed for your expenses from your employer. Alternatively, you could claim a tax deduction from your income. However, this doesn’t include the costs of your usual commute to work- only trips completed in work hours.
If you are self employed
Self employed van drivers who use their vehicle for their own business can claim expenses related to your vehicle for travel from home to work, to visiting clients or customers, or to perform a job related to your work–picking up parts needed to complete a job, for example.
You cannot, however, claims cannot be made for travel between your home and a building where you will work from for more than 24 months, or any travel that is not related to work. For example, you needed to use the van to pick up some furniture for home.
In order to claim a percentage of vehicle expenses, keep a logbook of your mileage and other vehicle expenses during that time. You may be able to claim the difference in cost between a personal insurance policy and one that is used for business.
About the Author: John Loughran
