Claim capital allowances
Business cars
You can claim capital allowances on cars you buy and use in your business. This means you can deduct part of the value from your profits before you pay tax.
Use writing down allowances to work out what you can claim.
There’s a different way to work out what you can claim if the car qualifies for the 100% first-year allowance - for example, if it’s an electric car or a car with zero CO2 emissions.
Cars do not qualify for annual investment allowance, super-deduction, full expensing or 50% first-year allowances.
Sole traders and partnerships
You can claim simplified mileage expenses on business vehicles instead, if you’re either:
- a sole trader
- a partnership that has no company partners
You cannot claim simplified mileage expenses if you’ve already claimed for the vehicles in another way.
Employees
If you’re an employee you cannot claim capital allowances for cars, motorbikes and bicycles you use for work, but you may be able to claim for business mileage and fuel costs.
What counts as a car
For capital allowances a car is a type of vehicle that:
- is suitable for private use - this includes motorhomes
- most people use privately
- was not built for transporting goods
What does not count
Because they do not count as cars you can claim annual investment allowance on:
- motorcycles - apart from those bought before 6 April 2009
- lorries, vans and trucks
Rates for cars
You can claim one of the following:
- the full value of the car as 100% first-year allowances
- 18% of the car’s value (main rate allowances)
- 6% of the car’s value (special rate allowances)
Read more about main and special rate allowances pools.
Which rate you can claim depends on when you bought the car and its CO2 emissions.
Check your car’s CO2 emissions.
Main and special rates apply from 1 April for businesses that pay Corporation Tax, and 6 April for businesses that pay Income Tax. The 100% first-year allowances rate applies from 1 April for all businesses.
Cars bought from April 2021
| Description of car | What you can claim |
|---|---|
| New and unused, CO2 emissions are 0g/km (or car is electric) | 100% first-year allowances |
| Second hand electric car | Main rate allowances |
| New or second hand, CO2 emissions are 50g/km or less | Main rate allowances |
| New or second hand, CO2 emissions are over 50g/km | Special rate allowances |
Cars bought between April 2018 and April 2021
| Description of car | What you can claim |
|---|---|
| New and unused, CO2 emissions are 50g/km or less (or car is electric) | 100% first-year allowances |
| Second hand electric car | Main rate allowances |
| New or second hand, CO2 emissions are 110g/km or less | Main rate allowances |
| New or second hand, CO2 emissions are over 110g/km | Special rate allowances |
Cars bought between April 2015 and April 2018
| Description of car | What you can claim |
|---|---|
| New and unused, CO2 emissions are 75g/km or less (or car is electric) | 100% first-year allowances |
| Second hand electric car | Main rate allowances |
| New or second hand, CO2 emissions are 130g/km or less | Main rate allowances |
| New or second hand, CO2 emissions are over 130g/km | Special rate allowances |
Cars bought between April 2013 and April 2015
| Description of car | What you can claim |
|---|---|
| New and unused, CO2 emissions are 95g/km or less (or car is electric) | 100% first-year allowances |
| Second hand electric car | Main rate allowances |
| New or second hand, CO2 emissions are 130g/km or less | Main rate allowances |
| New or second hand, CO2 emissions are over 130g/km | Special rate allowances |
Cars bought between April 2009 and April 2013
| Description of car | What you can claim |
|---|---|
| New and unused, CO2 emissions are 110g/km or less (or car is electric) | 100% first-year allowances |
| New or second hand, CO2 emissions are 160g/km or less | Main rate allowances |
| Second hand electric car | Main rate allowances |
| New or second hand, CO2 emissions are over 160g/km | Special rate allowances |
Cars bought before April 2009
Move the balance of any cars bought before April 2009 to your main rate allowances pool when you work out how much you can claim.
If your car does not have an emissions figure:
- use the special rate
- use the main rate if it was registered before 1 March 2001
Using cars outside your business
If you’re a sole trader or partnership and you also use your car outside your business, work out what you can claim based on the amount of business use.
If your business provides a car for an employee or director you can claim capital allowances on the full cost. You may need to tell HMRC the car is a company benefit if they use it personally.