Disabled individuals ― motor vehicles

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

Autumn Budget 2025

Disabled individuals ― motor vehicles

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

Autumn Budget 2025

This guidance note provides an overview of the situations where a disabled person or charity can purchase or hire / lease a motor vehicle at the zero rate of VAT.

Autumn Budget 2025

Changes are to be made to the VAT and Insurance Premium Tax (IPT) treatment of vehicle leases entered into after 30 June 2026.

The VAT changes are intended to restrict reliefs for expensive vehicles provided under qualifying schemes which lease vehicles to eligible disabled people. The IPT changes are intended to bring the tax treatment of qualifying schemes into line with that of other commercial lease providers.

What conditions need to be met to zero-rate a motor vehicle?

The following provides a summary of the types of supply that can be zero-rated under this relief:

Type of user	What goods / services can be zero-rated?
Disabled wheelchair user or individual purchasing a vehicle on behalf of a wheelchair user (nominated representative)	The supply of a ‘qualifying motor vehicle’ that has either been designed to enable the disabled wheelchair user to

Continue reading the full document

To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™

TAKE A FREE TRIAL NOW

Popular Articles

Personal Tax

Timing of disposal for capital gains tax

Timing of disposal for capital gains taxDate of disposalThe date of the disposal determines the period in which the gain is subject to capital gains tax (CGT). When the rates of CGT change, the determination of the date of disposal can also affect the rate of CGT that applies to the gain.See the

14 Jul 2020 13:50 | Produced by Tolley Read more

Year-end tax planning

Personal Tax

Married couple’s allowance

Married couple’s allowanceThe married couple’s allowance (MCA) is only available if one of the two spouses or civil partners was born before 6 April 1935. This means that one member of the couple must be at least 89 years old on 5 April 2024 to qualify for an allowance in the 2023/24 tax year.There

14 Jul 2020 12:13 | Produced by Tolley Read more

Owner-Managed Businesses

Sales, advertising and marketing

Sales, advertising and marketingExpenditure on sales, advertising and marketing activities may include amounts which are disallowable for the purposes of calculating trading profits. This may be because the expenditure is:•capital in nature (see the Capital vs revenue expenditure guidance note)•not

14 Jul 2020 13:28 | Produced by Tolley Read more

Disabled individuals ― motor vehicles