What different types of capital allowances are available? What are the current and past rates of allowances?

This is a freeview 'At a glance' guide to capital allowances: rates and allowances. 

Capital allowances should be considered in business planning when an existing business has plant and machinery or other assets.

Capital allowances' main rates

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

Expenditure on plant and machinery, and structures and buildings.

Type

2023-24 to 2024-25

2021-22 to
2022-23

2020-21

2019-20

2017-18 to 2018-19

2015-16 to 2016-17 

Full expensing*

100% main rate

50% special rate

- - - - -
Super-deduction** -

130%/50%/100%

- - - -

Annual Investment Allowance (AIA) 

Limit:

100% 

£1 million 

100% 

£1 million 

 


100%

 £1 million

 

100% 

£1 million

 

100% 

£200,000

 

100% 

2015-16: £500,000
2016-17: £200,000

Writing-down allowance (WDA): general pool

18%

18%

18%

18%

18%

18%

WDA special rate pool: including Integral features and Long life assets

6%

6%

6%

6%

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%

First Year Allowance (FYA): Electric car charging points***

100%

100%

100%

100%

100%

100% from 23 November 2016

Structures and Buildings Allowance (SBA)

3% straight line

3% straight line

3% straight line

2% straight line

From 29/10/18 2% straight line

-

Enterprise Zone

Limit

100%

€125 million

100%

€125 million

100%

€125 million

100%

€125 million   

100%

€125 million

100%

€125 million

Enhanced Capital Allowances (ECA) (energy-saving and environmentally beneficial plant and machinery)

100% ECAs in Enterprise Zones until the later of 31 March 2021 and eight years from the date the area was designated or treated as designated

100% ECAs in Enterprise Zones until the later of 31 March 2021 and eight years from the date the area was designated or treated as designated

Withdrawn except in respect of Enterprise Zones

100%      

100%

100%

Freeports (new designated sites):

ECAs 
SBAs

Super Deduction** & AIA

 


100%
10%

If within expenditure limits

 

 
100%
10%

If within expenditure limits

       

Investment Zones (new designated sites):

ECAs 
SBAs

Super Deduction** & AIA

 


100%
10%

If within expenditure limits

 

       
Business Property Renovation Allowance         (withdrawn from April 2017)  100%

*From April 2023, companies incurring qualifying expenditure on new plant and machinery on or after 1 April 2023 can claim:

  • 100% First Year Allowances (FYAs) for main rate expenditure (‘full expensing’).
  • 50% FYAs for special rate expenditure, including long-life assets.

**The Super Deduction is available only to companies, at a rate of 130% for main rate assets, 50% for special rate assets (i.e. Fixtures and Integral Features), or 100% for assets used partly for ring-fenced trades and partly for qualifying trades (on apportionment). The Super Deduction is available for qualifying expenditure incurred between 1 April 2021 and 31 March 2023.

***Finance (No. 2) Act 2023 extends the 100% First Year Allowance for electric vehicle charge points to 31 March 2025 for Corporation Tax purposes and 5 April 2025 for Income Tax purposes. 

Motor cars 

Cars purchased from 1 April 2018/5 April 2018 

(includes cars used by sole traders or partnerships with private use in a single asset pool)

2021-22 
to
2024-25

2018-19
to
2020-21

Type

Rate

Rate

FYA for new electric cars or new zero-emission

100%

100%
FYA if CO2 emissions are 50g/km or lower (new cars only)

n/a

100%
WDA if CO2 emissions are 50g/km or lower (includes FYA qualifying cars if FYA not claimed)

18%

18%

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

6%

18%

WDA if CO2 emissions exceed 110g/km

6%

6%

 

 Purchased between April 2015 and April 2018

2015-16 to 2017-18 

Type

 Rate

FYA for new electric cars or if CO2 emissions are 75g/km or lower (new cars only)

100%

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

18%

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

18%

WDA if CO2 emissions exceed 130g/km

8% 

See Vehicles (4 wheels): Allowances