When is a Pool Vehicle not a Pool Vehicle?

Philip Eagle

Tax Director

Within businesses, there is often confusion between pool vehicles and company vehicles. Pool vehicles are exempt from a benefit-in-kind charge provided certain conditions are met.

Company vehicles are taxable. It is vital to categorise your vehicles correctly and maintain records as evidence.

A pool vehicle is exempt from the benefit-in-kind regime if all these requirements are met:

  1. The vehicle should be made available to more than one employee and should also be used by more than one employee.
  2. The vehicle should be made available to each of the employees by reason of their employment.
  3. The vehicle should not ordinarily be used by one person to the exclusion of others, which is an additional requirement to (1) above.
  4. Any private use of the vehicle should be incidental. Although there is no rule in the tax legislation on how much private use is incidental, it will be necessary to examine each case on its facts.
  5. The vehicle should not normally be kept at or near the home of an employee overnight. It should usually be kept at the company premises overnight.

If all these requirements are not met then the vehicle may be classified as a company vehicle and liable for tax.

How Hallidays can help

Hallidays recommends if you have pool vehicles you should maintain records to evidence how they are used within your business or organisation. These should include:

  • The names of the employees who use the vehicle
  • The times & dates the vehicle was taken & returned to the business
  • The nature of the trip
  • The number of miles travelled

Ensure you keep copies of relevant car insurance policies. These are often reviewed by HMRC as evidence of who has access to drive a motor vehicle.

If you would like to discuss whether a business vehicle falls under the legislation of a pool vehicle or company car/van our specialist experts are here to help. For further information on tax rates and allowances please visit or contact the tax team on 0161 476 8276 or email

Posted 16th November 2016

Reviewed 12th December 2018

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