Capital Allowances on Business Cars

The move to penalising those using cars with higher CO₂ emissions continues, with changes from 6 April 2009. Any cars purchased after that date for business use will receive different rates of capital allowance depending on the CO₂ emissions. Cars with CO₂ emissions of up to 110 g/km will receive a 100% first year allowance. Cars emitting up to 160 g/km go into the main capital allowance pool with writing down allowances of 20%, whereas those with more than 160 g/km will only receive 10% writing down allowance. These rates will fall to 18% and 8% respectively from 6 April 2011. There will also be no balancing allowance when the cars are sold.