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car hire business capital allowances

car hire business capital allowances

Does the 10% allowance on vehicles over 160 g/km co2 apply to car hire businesses ?? ie where all the vehicles are bought solely for business use (rather than for any staff) and are hired out to to the public.

Can all these vehicles all still go into one pool (as under the old rules) and then claim 20% capital allowances ??

Can anyone point me to the official HMRC technical guidance ?


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22nd Nov 2009 17:51

Manuals not yet updated

HMRC's capital allowances manual has not been updated yet, but the law is pretty simple in fact :

1.  Cars purchased before 1 April (6 April in income tax) will stay under the old £12,000 single asset pool arrangements for another 5 years

2.  All cars purchased by companies will be added either to the main plant & machinery pool (emissions up to and including 160 g/km) or the special rate pool (over 160g/km) and attract WDA rates accordingly of 20% and 10%. There is therefore no balancing allowance on disposal

3.  Cars with private use (income tax businesses only) must be put in a single asset poool and WDA claimed at either 10% or 20% as appropriate but there will be a balancing allowance or charge on disposal as it is a single asset pool. Other cars in income tax business are treated as above.

4.  There are no other rules for capital allowances.

See Finance Act 2009 Schedule 11 Part I.

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11th Nov 2011 11:22


I know this was posted some time ago howver as this is a car hire company does CA23515 suggest that the 5 year transition does not apply to hire cars that were previously exempt from the £12,000 restriction?

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