100% Capital Allowances for Low Emission Cars Print

100% capital allowances may be claimed for the year in which the expenditure is incurred on electrically propelled cars, or cars with low CO2 emissions. From April 2021 only cars with emissions of 0g/km qualify for this allowance. The car must be bought new and unused. It must not be bought for the trade of leasing, or acquired during the accounting period in which the trade is permanently discontinued.

The relief has been extended until April 2025, and for a car to qualify as a low emission car, it must have a UK approval certificate, or EC certificate of conformity certifying that its carbon dioxide emissions are:

  • 0g/km for expenditure incurred on or after 1 April 2021
  • 50g/km or less for expenditure incurred on or after 1 April 2018
  • 75g/km or less for expenditure incurred before 1 April 2018.

The legislation includes taxis within the definition of cars for this purpose but specifically excludes motorcycles.

Low emission cars acquired before April 2009 and costing in excess of £12,000 are exempt from the requirement to be held in a single asset pool. They are also excluded from the normal restriction applied to the hire charge in respect of cars whose retail price when new exceeds £12,000.

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