Commentary

B3.342 Plant and machinery allowances—cars

Business tax
Business tax | Commentary

B3.342 Plant and machinery allowances—cars

Business tax | Commentary

B3.342 Plant and machinery allowances—cars

For the latest New Development, see ND.1862.

Expenditure on the provision of a car which is not within one of the exceptions noted below under 'Meaning of car' is subject to the following special rules:

  1.  

    •     no annual investment allowance is given (see B3.329)1

  2.  

    •     no first-year allowance is given, unless the car has very low CO2 emissions within the provisions described in B3.324A2

  3.  

    •     where there is non-business use of the car the provisions in B3.359 apply3

  4.  

    •     cars other than hire cars for the disabled do not qualify for short-life assets treatment (see B3.343)4

Expenditure on cars other than those in CAA 2001, s 268A(1)(a)–(c) will be allocated to one of two plant or machinery pools — the main pool or the special rate pool5 and qualify for writing-down allowances accordingly.

For HMRC guidance on the treatment of cars see CA23510–CA23560.

Main rate car

A main rate car is6:

  1.  

    (i)     a car that is first registered before 1 March 2001

  2.  

    (ii)     a car that has low CO2 emissions, or

  3.  

    (iii)     a car that is electrically-propelled

For these purposes a car has low CO2 emissions if, when it is first registered, it is registered on the basis of a qualifying emissions certificate and the applicable CO2 emissions figure does not exceed 50 g/km (110g/km for expenditure incurred before 6 April 2021 (income tax) or 1 April 2021 (corporation tax))7. See T6.117 for earlier thresholds.

This amount can be amended by Treasury Order8. Despite (i) and (ii) above a car

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