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The Capital Allowances Act 2001 (Cars Emissions) Order 2016

S.I. 2016/984 · Made 10 October 2016 · Extends to United Kingdom

Up to date with all changes known to legislation.gov.uk, revised to 3 August 2017.

Corporation Tax

Income Tax

Made 10th October 2016

Laid before the House of Commons 11th October 2016

Coming into force 1st November 2016

The Treasury make the following Order in exercise of the powers conferred by sections 45D(1A) and (7) and 104AA(5) of the Capital Allowances Act 2001f1.

Annotations to the whole text

Footnotes

f1

2001 c.2; section 45D was inserted by section 59 of, and paragraph 3 of Schedule 19 to, the Finance Act 2002 (c.23); section 45D(1A) was inserted by section 64(2) of the Finance Act 2014 (c.26); section 104AA was inserted by paragraph 8 of Schedule 11 to the Finance Act 2009 (c.10).

Contents

  1. 1Citation and commencement
  2. 2Article 2
  3. 3Amendment of the Capital Allowances Act 2001
  4. 4Article 4
  5. 5Article 5
  6. 6Revocation
  7. 7Savings
  8. Signature
  9. Explanatory note

1Citation and commencementI1

This Order may be cited as the Capital Allowances Act 2001 (Cars Emissions) Order 2016 and comes into force on 1st November 2016.

2I1

F1(1)

The amendments made by article 4(b) and article 5 have effect in relation to expenditure incurred on or after 1st April 2018.

F2(2)

This article is subject to article 7 (savings).

3Amendment of the Capital Allowances Act 2001I1

The Capital Allowances Act 2001 is amended as follows.

4I1

In section 45D—

(a)

in subsection (1)(a)f1 for “2018” substitute “2021”; and

(b)

in subsection (4)f2 for “75” substitute “50”.

5I1

In section 104AA(4)f1 for “130” substitute “110”.

6RevocationI1

Article 4(a) of the Capital Allowances Act 2001 (Extension of first-year allowances) (Amendment) Order 2015f1 is revoked.

7SavingsF1

(1)

In relation to expenditure incurred on the hiring of a car—

(a)

for a period of hire which begins before the relevant date, and

(b)

under a contract entered into before that date,

section 49(1A) (car hire: supplementary) of the Income Tax (Trading and Other Income) Act 2005 and section 57(1A) (car hire: supplementary) of the Corporation Tax Act 2009 apply as if the amendment made by article 5 did not have effect.

(2)

“The relevant date” means—

(a)

in the case of income tax, 6th April 2018, and

(b)

in the case of corporation tax, 1st April 2018.

Signature

Stephen Barclay

David Evennett

Two of the Lords Commissioners for Her Majesty’s Treasury

10th October 2016

Explanatory note

(This note is not part of the Order)

This Order amends sections 45D and 104AA of the Capital Allowances Act 2001 (c.2). These sections set out the conditions to qualify for 100% first-year allowances (section 45D) and main rate allowances (section 104AA) on expenditure in respect of cars with low carbon dioxide emissions.

Article 4 extends the first-year allowance for cars with low carbon dioxide emissions for a further three year period ending on 31st March 2021. It also reduces the qualifying emissions threshold for the first-year allowance from 75 grams to 50 grams per kilometre driven, in relation to expenditure incurred on or after 1st April 2018.

Article 5 reduces the qualifying emissions threshold for the main rate allowance from 130 grams to 110 grams per kilometre driven, in relation to expenditure incurred on or after 1st April 2018.

This Order revokes article 4(a) of S.I. 2015/60, which previously amended section 45D(1)(a) of the Capital Allowances Act 2001.

A Tax Information and Impact Note covering this instrument will be published on the website athttps://www.gov.uk/government/collections/tax-information-and-impact-notes-tiins.