Q I have mounted a large X compressor on a goods
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vehicle chassis for use on various construction sites. The result is that the vehicle cannot now carry goods. Could it be taxed as private or should it be taxed as engineering plant? Am I allowed to use rebated fuel?
A The annual rate of duty on mechanically propelled vehicles is levied according to the provisions of the Vehicles (Excise) Act 1971. Undoubtedly your vehicle would be regarded as " carrying goods or burden of any description whether in the course of trade or otherwise " and it will have to be taxed according to the scale of charges contained in Schedule 4 of the Act.
There is no special provision contained in the Act for "engineering plant."
However, the charges are based on the unladen weight of the vehicle. Paragraph 5(1) of Schedule 4 states that "A mechanically propelled vehicle constructed or adapted for use and used for the conveyance of a machine or contrivance and no other load except articles in connection with the machine or contrivance not being a vehicle for which an annual rate of duty is specified in Schedule 3 to this Act, shall, not withstanding that the machine or contrivance is built in as part thereof, be chargeable with duty at the rate which would be applicable if the machine or contrivance were burden and not included in the unladen weight of the vehicle."
In other words, the weight of the compressor need not be included in computing the taxable weight of your vehicle. You may not use rebated fuel in the vehicle. In general, only if your vehicle was taxed at the reduced rate under the 1971 Act would you be able to do so. Excise notice No. 75 obtainable free from the Department of Customs and Excise sets out when the use of rebated fuel is allowed.