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Capital allowances main rates

(see the left-hand menu for detailed guidance on Capital allowances)

Type

2020/21

2019/20

2017/18 to 2018/19

2015/16 to 2016/17 

2014/15

2013/14

2012/13 to 2014/15

Enhanced capital allowances (ECA) (energy-saving and environmentally beneficial plant and machinery)

Withdrawn except in respect of Enterprise Zones

100%

100%

100%

100%

100%

100%

First Year Allowance: Electric car charging points

100%

100%

100%

100% from 23 November 2016

     

Enterprise Zone

Limit

100%

€125 million

100%

€125 million

100%

€125 million

100%

€125 million

100%

€125 million

100%

€125 million

100%

€125 million

Business Property Renovation

- (withdrawn from April 2017)

- (withdrawn from April 2017)

- (withdrawn from April 2017)

 100%

 100%

 100%

100%

Flat Conversion Allowance

-

-

-

 -

 -

-

100%

Landlord's Energy Savings Allowance

-

-

-

 -

 £1,500

 £1,500

£1,500

Annual investment allowance (AIA) 

100%

100%

100%

 100%

 100%

 100%

100%

AIA annual limit

  

From 1/6-April-12 £25,000

From 1-Jan-13 £250,000

From 1/6-April-14 £500,000

From 1-Jan-16 £200,000

From 1-Jan-19 £1,000,000

From 1-Jan-21 £200,000 *

First-year allowance (FYA) for expenditure not covered by ECA or AIA

-

-

-

 -

 -

 -

-

Writing-down allowance (WDA) - general pool

18%

18%

18%

 18%

 18%

 18%

18%

WDA - integral features and Long life assets

6%

6%

8%

 8%

 8%

 8%

8%

Small pool write off, written-down balance in either or both WDA pool(s) is £1,000 or less

100%

100%

100%

 100%

 100%

 100%

100%

Structures and buildings allowance

3% straight line

2% straight line

From 29/10/18 2% straight line

-

-

-

-


*It is likely that from 1 January 2021 the AIA limit will revert back to £200,000 being the ‘permanent limit’. The permanent limit was introduced to end the regular changes and transitional arrangements. 

Motor cars 

 Cars purchased between from 1 April 2018/ 5 April 2018 if a sole trader or partnership

2018/19
to
2020/21

Type

Rate

FYA for electric cars or if CO2 emissions are 50g/km or lower

100%

WDA if CO2 emissions are between 50g/km and 110g/km

18%

WDA (second-hand vehicles) if CO2 emissions are less than 110g/km

 18%

WDA if CO2 emissions exceed 110g/km

6%


Motor cars 

 Purchased between April 2015 and April 2018

2015/16 to 2017/18 

2013/14 to 2014/15

 2012/13

 To 2011/12

Type

 Rate

 Rate

Rate

Rate

FYA for electric cars or if CO2 emissions are 75g/km or lower

100%

     

FYA for electric cars or if CO2 emissions are 95g/km or lower

 

100%

   

FYA for electric cars or if CO2 emissions are 110g/km or lower

   

100%

100%

WDA (second-hand vehicles) if CO2 emissions do not exceed 130g/km

18%

 18%

   

WDA (second-hand vehicles) if CO2 emissions do not exceed 160g/km

   

18%

20%

WDA if CO2 emissions exceed 75g/km but do not exceed 130g/km

18%

     

WDA if CO2 emissions exceed 95g/km but do not exceed 130g/km

 

18%

   

WDA if CO2 emissions exceed 110g/km but do not exceed 160g/km

 

 -

18%

20%

WDA if CO2 emissions exceed 130g/km

8% 

8%

 -

 -

WDA if CO2 emissions exceed 160g/km

 

 -

8%

10%


Finance Act 2020 

  • Included changes to the Structures and buildings allowance.
  • It appears that policy proposals originally published with Finance Bill 2020 have been postponed. It was expected that that from April 2021 the CO2 thresholds were to be reduced and FYA extended. The following measures have not been legislated:
    • The 100% FYA will be extended to apply to zero-emission cars, for four years from 1 April/6 April 2021.
    • The 18% rate will apply to cars with CO2 between 1 and 50g/km.
    • The 6% will apply to cars with CO2 emissions above 50g/km.
    • First-year allowances for zero-emission goods vehicles and gas refuelling equipment are extended from 1 April 2018 to March/April 2021.
  • From 1 April 2020 the 100% allowance for ECAs in Enterprise Zones remains available for expenditure incurred in relation to all designated assisted areas, whenever designated, until at least 31 March 2021.

Finance Act 2019

From 1/6 April 2019:

  • Reduce the WDA rate for the special rate pool from 8% to 6%.
  • Extend the FYA for electric charge points until 31 March 2023.

From 1/6 April 2020:

  • End ECAs from 1 April 2020 for companies and 6 April 2020 for unincorporated businesses.

From 1 January 2019:

  • Temporarily increase the AIA to £1million for two years from 1 January 2019.

From 29 October 2018:

  • Introduced a new Structures and Buildings Allowance for qualifying expenditure incurred on or after 29 October 2018. This will be at an annual rate of 2% on a straight-line basis with no balancing adjustments on disposal.
  • Restrict expenditure on altering land for the installation of plant and machinery to where the plant and machinery itself qualify for allowances.

Comments (1)

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is it confirmed that the ECA was withdrawn in April? What tax treatment would a Tesla electric vehicle get now?

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