Capital Allowances and Cars

Businesses purchasing low CO2 emission cars (including electric cars) were eligible to claim 100% first year allowances on the cost of such vehicles up to and including 31 March 2013.  The Chancellor has decided to extend this regime for a further 2 years (up to 31 March 2015) but the qualifying CO2 threshold was reduced on the 1 April 2013 from the previous level of 110grams per kilometer to 95 grams per kilometer.

It has also been decided to change the emissions threshold for main rate cars which are eligible for 18% writing down allowances. These were originally set at a maximum limit of 160 grams per kilometer; with affect from 1 April 2013 will be lowered to 130 grams per kilometer.  Cars with CO2 emissions above this limit now fall into the special rate pool and only qualify for 8% writing down allowances.

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