When a Cargo Van Is Considered a Passenger Vehicle

A cargo van is usually considered to be a private passenger vehicle, the same as a car. However, if it has more than 9 seats fitted, including the driver’s seat, or is planned to be used for business purposes, it will be classed as a commercial vehicle.


Private Passenger Vehicle

There are numerous types of vehicles that can be classified as a private passenger car, including cars, minivans, and pick-up trucks.

To be classified as a private passenger vehicle though, the vehicle must be under a certain weight and not have more than nine seats.

Also no vehicle owned by or associated with a business for commercial purposes can be classified as a private passenger vehicle.


A Cargo Van Can Be a Private Passenger Vehicle

Provided a cargo van has not been customized to carry more than nine people and is not intended as a commercial vehicle, it is therefore be a private passenger vehicle.

A cargo van is a relatively small van that allows access to the cargo department from the driver’s seat.

This access is beside the side and back door, which a cargo van will have, allowing for easy access to the cargo area even during inclement weather conditions.

What makes a cargo van impressive as a passenger vehicle is that it has plenty of space, all of which is protected from the elements. It can easily be customized to carry all the family and any luggage or pets they may have, making it perhaps ideal for family trips and getaways.

Whilst providing ample space for a family, it is also reasonably fuel efficient. Although some trucks and larger vans may have more power than a regular cargo truck, the cargo truck is certainly powerful enough to cope with a family, their baggage, and even tents if need be.

The cargo van has in recent years become increasingly popular because of its versatility, but that versatility has perhaps made it more popular as a commercial vehicle than a family vehicle. Many small business owners though will use a cargo van both as their personal vehicle and a business vehicle.


Customization of a Cargo Van

As well as the option to just add a couple of seats for extra family members, a cargo van has almost unlimited potential to be customized for many types of small business.

The sides of a cargo van can have attachments to hold ladders, or a roof rack can be fitted for other equipment unsuitable to be carried inside the cargo area. This means a cargo van is ideal for small businesses such as maintenance contractors, caterers, window cleaners, vets, painters, and an assortment of other businesses.

Being able to customize the interior of a cargo van means the driver can organize his tools and load for easy access.

Many of these customizations though do not exclude the van from being used as a personal vehicle and are often utilized as a dual-purpose vehicle, both business and pleasure.


Limitations of Cargo Van Use

As mentioned a cargo van is becoming increasingly popular especially for small business owners. Many small business owners cannot afford two vehicles, one for business and another purely for personal use and so, for them, a cargo van is often the perfect choice.

To use their cargo van for business purposes though, they should define it as that for insurance purposes. Although they may have to pay more insurance on the business vehicle, at least that insurance will also cover them for personal use.

If a small business owner wants to claim expenses for fuel or maintenance for their cargo van, they must insure it as a commercial vehicle, and register it as listed property for that business.

A vehicle that is registered as listed property for a business allows its owner to claim for its purchase, fuel use and maintenance. This is of course beneficial for any business, but there are certain limitations to those claims.

The main limitation on making claims for tax deductions on a vehicle  listed property, is that it must be used for business purposes at least 50% of the time. This means that a small business owner must keep accurate mileage records of the cargo van’s use.

The cargo van can still be used as a personal vehicle, but the mileage used for personal use must not exceed more than 50% of the van’s overall mileage. If it does, not only will it disqualify the owner from claiming for business expenses for the van, it may also lead to potentially having to pay back previously claimed deductions.


Advantages of a Private Passenger Vehicle

Owning a private passenger vehicle usually has the advantage of lower insurance costs. Also it can be driven by anyone without the need for them to have a commercial driver’s license.


Advantages of a Cargo Van as a Private Passenger Vehicle

Cargo vans are becoming popular as private vehicles is due to several reasons:

  • They can easily fit a full family, plus their baggage
  • Fuel economy is better than larger vehicle
  • The maneuverability of a cargo van is good, often referred to as being similar to a large SUV
  • More comfort for the driver


Disadvantages of Having a Vehicle Registered as a Private Passenger Vehicle

Whilst there are several advantages to owning a private passenger vehicle, there is the disadvantage that it cannot be used for any type of business purpose.

If a private vehicle is involved in an accident and at the time of that accident it was being used for business, it could cause additional problems. The problem would be with the insurance coverage being incorrect.

As the vehicle was not insured as a commercial vehicle, resolving the costs could be very high. Often these situations result in the owner of the vehicle paying more than they would have in the additional insurance premiums.



A cargo van can and often is registered as a private personal vehicle if it is not intended to be used for business. This can save on insurance premiums and still provide the owner with ample scope in what they can use their cargo van for, providing it is of a personal nature.

Cargo vans are compact and can carry a wide assortment of personal gear, ideal for family road trips. It is maneuverable and so can negotiate smaller parking spaces. Unfortunately though, a cargo van is not designed or compatible for off-road tracks or venues.

They are only a little bit more fuel efficienct than that a regular car and certainly far more efficient than larger vans or trucks.

The driver comfort in a cargo van is more similar to an SUV than to a truck or other types of van. This means a cargo van can be driven in relative comfort either on long road trips or short business deliveries.

Driver comfort may not somuch concern to larger businesses, but when a small business owner has to do their own driving, it does become one.

In many States a cargo van that has been customized as an RV can also be registered as a passenger vehicle. However, some States may add an additional charge for this but it will not be equal to that of a commercial vehicle.

A cargo van is certainly a good asset as a passenger vehicle, but the owner should remember that even delivering Pizzas could be counted as being commercial usage. Having a cargo van which doubles as a business vehicle and a personal use vehicle ensures it can be used to its full value. Its easy maneuverability makes it equally as efficient in dropping kids at school and making door-to-door deliveries.

A final point is that even if you do register your cargo van as being used for business, due to its weight and size, it will not necessarily need to be driven by someone with a commercial driver’s license.

This means an owner can drive the cargo van for whatever purpose, with just his regular car driver’s license. Some larger companies do however insist even their cargo vans are driven by CDL holders, but this is company policy and not law.

Author: Kenneth Graham

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