Changes to the company car capital allowance boundaries have been announced in the chancellor’s 2016 Budget.
The 100% first year write-down boundary for company cars will be cut from 75g/km to 50g/km in April 2018, while at the same point the main rate of capital allowance will only be available on cars of 110g/km or below, rather than the 130g/km level currently in operation.
The capital allowance rate affects businesses that buy outright, and the amount of their business car asset they can write-off against pre-tax profits.
Many fleets that buy outright cap their company car policies at 130g/km, and the change announced today is likely to be reflected in decision-making policies.
