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HMRC internal manual

Capital Allowances Manual

HM Revenue & Customs
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Plant and Machinery Allowances (PMA): cars: CO2 emissions


New expenditure (that is, expenditure which falls to be treated under the new rules described in CA23535) on a car is allocated to either the main plant and machinery pool or the special rate pool, providing that there is no non-business use of the car.

The appropriate pool is decided by the car’s carbon dioxide emissions. Where the emissions are 160g/km driven or less the expenditure is allocated to the main pool and where the emissions exceed this threshold the expenditure is allocated to the special rate pool.

The car’s emissions figure is that stated on the qualifying emissions certificate for the car when it was first registered. A qualifying emissions certificate is either an EC certificate of conformity or a UK approval certificate, in other words a car’s emissions figures are stated on the V5. Emissions data for different makes and models of car can also be found on the Vehicle Certification Agency (VCA) website at .

Carbon dioxide emissions information included on the VCA website, in manufacturers’ promotional literature and available at the point of sale is required to reflect the worst case figure for that particular model description. Therefore, specifying optional equipment on a new car (roof bars, say) should not result in the vehicle delivered having a higher emissions figure than expected. However, it is recommended that businesses seek confirmation of the emissions figure of the specific car they are buying from the dealer.

Cars which were first registered before 1 March 2001 do not have carbon dioxide emissions data on their registration documents. So, to make compliance with the new rules easier for businesses, expenditure on cars that were registered before this date will be allocated to the main pool regardless of their actual emissions.

The UK and other European Union countries require that cars sold must meet a set of environmental and safety standards, often referred to as type approval. Each car sold must conform to a type (of which a sample has been submitted by the manufacturer or importer) that has been approved by a national certification agency. The level of carbon dioxide emissions is one of the factors recorded during the type approval testing. Very small manufacturers are exempted from this process so the cars they produce may not have known emission figures. Such cars tend not to have low carbon dioxide emissions so expenditure on them will be allocated to the special rate pool. Again, this approach has been taken for simplicity.

Where there is non-business use of the car so that the expenditure is allocated to a single asset pool, the rate of writing down allowance (WDA) claimable will still depend on the carbon dioxide emissions of the car. WDA will be given at 20% per annum on cars with carbon dioxide emissions not exceeding 160g/km and cars registered before 1 March 2001 and at 10% per annum on cars with emissions above this threshold and cars registered after 1 March 2001 with no emissions data.

The rates of WDA of the main pool and the special rate pool are reduced to 18% and 8% respectively from 1 April 2012 (CT) and 6 April 2012 (IT).