Running a Van for Business in Ireland: Costs, Tax, and Compliance

Annual cost breakdown — typical diesel medium van

A medium diesel van (Ford Transit Custom, VW Transporter, Renault Trafic, Vauxhall Vivaro, Peugeot Expert, etc.) covering around 25,000 km/year — typical for a working trade, light delivery or professional services van — breaks down approximately like this at April 2026 Irish prices:

Fuel cost per km at April 2026 Irish prices works out to ~14–18c/km for diesel — the biggest single variable operating cost. By comparison, an EV van on home night-rate electricity (12–18c/kWh, ~25 kWh/100km) comes in at 3–5c/km — a €2,500–€3,500 annual fuel saving at 25,000 km/year. More on the EV business case further below.

For the car-equivalent cost breakdown, see our cost of running a car in Ireland guide.

Choosing the right van

Picking the van size that matches your actual work matters more for annual cost than almost any other decision. Over-sizing wastes fuel, tax, insurance and depreciation; under-sizing forces multiple trips and damages the van faster.

Small vans (≤3.5m³ load volume)

• Models: Citroën Berlingo, Peugeot Partner, Opel Combo, VW Caddy, Ford Transit Connect (short), Renault Kangoo, Fiat Doblo
• Typical payload: 500–800 kg
• Fuel consumption: 6–7 L/100km diesel
• Motor tax: €333/year (under 3,000kg unladen)
• Best for: urban tradespeople, light courier, mobile services, pet groomers, beauticians — anyone who needs a van but not a big one

Medium vans (5–6.5m³)

• Models: Ford Transit Custom, VW Transporter, Renault Trafic, Opel Vivaro, Peugeot Expert, Citroën Dispatch, Toyota Proace
• Typical payload: 900–1,300 kg
• Fuel consumption: 7–9 L/100km diesel
• Motor tax: €333–€420/year depending on unladen weight
• Best for: plumbers, electricians, carpenters, flooring fitters, general trades, florists, delivery drivers — the sweet-spot for most Irish SME operations

Large vans (8–17m³)

• Models: Ford Transit (full size), Mercedes-Benz Sprinter, VW Crafter, Iveco Daily, Renault Master, Peugeot Boxer, Citroën Relay, Fiat Ducato, MAN TGE
• Typical payload: 1,200–2,000+ kg
• Fuel consumption: 9–12 L/100km diesel
• Motor tax: €333–€420/year if under 3,500kg GVW; jumps to €500 for 4,001–12,000kg
• Best for: builders, movers, wholesale delivery, multi-drop logistics, specialist fit-out, shuttle services — if you need the space, nothing smaller works

Electric vans

• Small: Citroën ë-Berlingo, Peugeot e-Partner, Renault Kangoo E-Tech, Maxus eDeliver 3, VW ID.Buzz Cargo (small spec)
• Medium: Ford E-Transit Custom, VW ID.Buzz Cargo, Renault Trafic E-Tech, Vauxhall Vivaro-e, Peugeot e-Expert, Maxus eDeliver 7
• Large: Ford E-Transit (full size), Mercedes eSprinter, VW ID. Buzz Cargo (long), Maxus eDeliver 9, Renault Master E-Tech
• Real-world range: 200–350 km (more with small vans and warm weather, less with heavy loads or Irish winter)
• Payload reduction vs diesel equivalent: typically 100–250 kg lower due to battery weight — check if your loaded use-case fits

Tax deductions for sole traders — the actual-cost method

The actual-cost method — worked example

A sole-trader plumber's van records for a tax year:

• Total km driven: 28,000
• Business km: 22,400 (80% based on logbook)
• Personal km: 5,600 (20%)
• Total motor expenses (fuel + insurance + tax + service + tyres + CVRT + repairs): €7,200
• Deductible business portion: €7,200 × 80% = €5,760 against trading profits

The 80/20 split needs to be evidenced — not just claimed. Revenue can ask for the underlying mileage log in an audit. A well-kept daily log of business vs personal trips, paired with total-km odometer readings at tax year-end, is the standard evidence format. odo.ie Pro's trip logbook makes this trivial — Business / Commute / Private categorisation per trip, period-scoped export for accountant hand-off.

What expenses count

• Fuel — diesel / petrol / electricity (metered home charging at the EV rate)
• Motor tax (goods rate or private rate as applicable)
• Commercial insurance
• CVRT test fee (annual)
• Servicing — oil changes, major services, parts and labour
• Tyres — cost amortised or as incurred
• Repairs — brake pads, clutch, timing belt, etc.
• Consumables — washer fluid, bulbs, wipers, cleaning, adblue
• Tolls paid on business journeys
• Parking incurred in the course of business
• Accessories — racks, shelving, toolbox fit-out — typically capitalised rather than expensed if over a de-minimis threshold

What doesn't count: fines and penalty points (explicitly non-deductible under Irish tax law), speeding FCNs, parking fines in a non-business context, motoring offences. Don't try.

VAT recovery & capital allowances

VAT on the van purchase

If you're VAT-registered AND the van is used exclusively or almost exclusively for business, you can typically reclaim the VAT on the purchase price. Commercial vans (N1 category) are treated significantly better than passenger cars for VAT purposes — Revenue places specific restrictions on VAT recovery for cars acquired for business use that don't apply to vans. Mixed personal/business use proportionally restricts recovery.

VAT on running costs

The same business-proportion rule applies. A VAT- registered sole trader with a van used 80% for business can reclaim 80% of the VAT on diesel, servicing, parts and tyres. Keep the VAT invoices — a receipt showing VAT number is typically required for reclaim.

Capital allowances — the 12.5% over 8 years rule

Capital expenditure on business vehicles qualifies for capital allowances at the standard commercial vehicle rate of 12.5% per year on a straight-line basis over 8 years. A €30,000 van:

• Year 1: €3,750 capital allowance claimable
• Year 2: €3,750
• Year 3: €3,750
• ... and so on until Year 8 fully writes the asset down

These are deductible against business profits in each year. If you sell the van before the 8 years are up, there's a balancing-charge or balancing-allowance calculation based on the sale proceeds vs the remaining tax written-down value — your accountant handles the mechanics.

Accelerated Capital Allowance (ACA) for EVs

Ireland operates an Accelerated Capital Allowance scheme for energy-efficient equipment including qualifying electric vehicles — allowing 100% write-off in Year 1 up to a cap (typically €24,000 for cars; specific rules apply to commercial vehicles). For a cash-flow-conscious small business, this is a meaningful benefit: the full capital cost offsets trading profits in the year of purchase rather than spreading over 8 years.

Eligibility criteria for ACA change with Budget updates — confirm current eligibility for your specific EV with your accountant before purchase. See also our SEAI EV grants guide for the purchase-side incentives.

Compliance essentials

CVRT — annual from year 1

The Commercial Vehicle Roadworthiness Test is annual from the first anniversary of registration for all N1 light commercial vehicles. LGV full test ~€141 inc VAT from January 2025 (re-test ~€57). Booked via cvrt.ie. Missing the CVRT = €60 FCN, 3 penalty points, and typically voided commercial motor insurance during the lapse. See our van tax & CVRT guide for the full mechanics.

RF111A Goods-Only Declaration

Required for the goods-rate motor tax on vehicles ≤3,500kg. Garda-witnessed declaration that the vehicle is used solely for trade/business. Personal use of a goods-taxed van = vehicle seizure + back-tax at private rate + penalties + potential insurance breach.

Tachograph — 3,500kg+ GVW for hire/reward

Tachographs (digital, recording driver hours and rest periods) are required for vehicles over 3,500kg GVW used for the carriage of goods by road for hire or reward — and in some cross-border situations from 2,500kg. Internal driver for own-business, sub-3,500kg: not required. Step up to a Sprinter-class 3.5t+ for haulage: required, plus driver hours rules under EU regulation. Check with the RSA for current specifics.

Driver CPC — commercial transport qualifications

Driver CPC (Certificate of Professional Competence) is required for drivers of vehicles over 3,500kg GVW used for hire or reward. 35 hours of periodic training every 5 years. Sole-trader in own van sub-3,500kg: not required. Move into a bigger van for commercial haulage: required before you can drive professionally. Plan for the lead-time.

Daily walk-around check (recommended)

Best practice for any commercial operator — even below the regulatory threshold for fleet-operator licensing: a 30-second daily walk-around at the start of each shift. Check lights, tyres, load security, fluid leaks visible under the vehicle, windscreen wipers, brake and indicator function. Catches genuine defects before they become crashes, insurance claims, CVRT fails, or Gardaí-stop incidents. Easy to log in odo.ie as a recurring quick-entry.

Waste / hazardous goods

If your van transports waste (construction waste, skip materials, garden waste) you may need a Waste Collection Permit from the National Waste Collection Permit Office (nwcpo.ie). For commercial quantities of hazardous goods (ADR) — paints, fuels, gases in specific packaging above threshold quantities — ADR driver training and vehicle approval apply. Plumbers and electricians carrying small quantities of sealants, oils and solvents typically fall below ADR thresholds but double-check if you're in doubt.

The electric van business case

Ireland has steadily tilted policy in favour of EV commercial vehicles, and for many Irish small-business use cases the total-cost-of-ownership maths now genuinely favours electric — provided you can charge at home or the depot.

The incentive stack

• SEAI purchase grant — up to €7,600 for qualifying N1 electric vans ≤3,500kg GVW with list price ≤€90,000
• VRT under Category B at 8% of OMSP (applies when CO₂ ≤120g/km, which all BEVs meet)
• Motor tax €120/year (vs €333–€420 diesel equivalent)
• BIK at flat 8% of OMV for employer-provided vans, with the universal 2026 €10,000 OMV reduction for BIK calculations further reducing effective BIK on higher-value vans
• Accelerated Capital Allowance potentially — 100% Year-1 write-off subject to eligibility

Running-cost comparison (25,000 km/year)

An electric van can save €3,000–€4,000/year in operating costs at 25,000 km/year vs a diesel equivalent — if you can charge at home overnight on night-rate electricity (typically 12–18c/kWh). Add the €7,600 SEAI grant and favourable capital allowances and the purchase-price gap closes rapidly over a 5-year holding period.

The limitations — when EV doesn't (yet) work

• High daily distance without home charging — a rural delivery van doing 300+ km/day across poorly-served charging territory is still better on diesel today
• Heavy loads regularly at max payload — battery weight reduces payload 100–250 kg vs equivalent diesel; at maximum-load operation this matters
• Short-haul quick-turnaround commercial with no downtime window — if the van must be out the door again in 15 minutes after unloading, rapid public charging at 60–80c/kWh shrinks the operating-cost advantage materially
• Cold winter range loss — BEVs typically lose 20–30% real-world range in Irish winter. If summer 280 km range is tight for your day, winter 200 km may not work
• Upfront capital if not leased — even with grant + ACA, EV vans are more expensive to buy new than diesel equivalents. Cash flow matters

Records you need to keep

Irish tax and regulatory record-keeping is demanding and Revenue audits do happen. The minimum records a sole trader should keep for a business van, for at least 6 years:

• Purchase invoice — full VAT breakdown, dealer details, VIN, price paid
• Motor tax receipts and goods-rate declarations (RF111A copies)
• Insurance certificates and annual schedules
• CVRT certificates for every year
• Service records — every invoice, garage details, mileage, work done
• Fuel receipts if claiming business-proportion — or a mileage log if using the logbook method
• Tyre + repair invoices
• Daily mileage log — odometer readings at tax year start and end; day-by-day or trip-by-trip Business / Personal classification
• Toll receipts for business journeys
• Finance / lease documentation — interest paid, capital repayments, balance at year end
• Parking receipts for business use

Revenue's 6-year retention requirement is a minimum; for the capital allowance asset itself, keep records for the full 8+ years of write-down plus 6 years after disposal. In practice, most Irish accountants recommend keeping van records permanently — the storage cost is zero and the audit cost is significant if you're missing documentation.

Frequently asked questions