Capital allowances
Based on CO2 emissions
The table below shows the WDA allowance as a percentage based on the official CO2 g/km figure for the vehicle in the pool
| 2024/25 | 2025/26 | |
|---|---|---|
| 100% First year allowance | 2024/250 or below | 2025/260 or below |
| 18% WDA - Main pool | 2024/251 to 50 | 2025/261 to 50 |
| 6% WDA - Special pool | 2024/25Above 50 | 2025/26Above 50 |
For corporation tax purposes the thresholds above apply to cars purchased on or after 1st April whereas for income tax purposes new tax years start on 6th April.
Finance Bill 2018-19 reduces the special pool rate from 8% to 6%
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.
Capital allowances for vans
A van with zero CO2 emissions is eligible for a 100% first year allowance if purchased before April 2021.
Other vans bought new from 1st April 2023 can be fully expensed.
Annual Investment Allowance
The annual investment allowance means you can deduct the full value of qualifying expenditure up to the limit of £1,000,000 per year.
Where qualifying expenditure exceeds the annual cap, tax relief will be given under the normal capital allowance regime via the main or special rate pools, with writing down allowances being given at the appropriate rates.