Writing down allowance
A writing down allowance is the percentage of an asset's remaining value you can deduct each year. Cars go into a pool and are written down at a rate that depends on their CO2 emissions.
Correct for the 2026/27 tax year. Last checked 12/09/2026.
The word "pool" is literal. The car goes into a pool of value, a percentage of the pool is deducted each year, and what is left carries forward.
What it means for your money
Relief comes slowly. A car written down at a low rate gives back a small fraction of its cost each year for a very long time, which is one reason the mileage rate suits most gig drivers better.
Private use has to be taken out. A car used half privately gets half the allowance, and that split has to be justifiable rather than convenient.
Where to read more
Capital allowances on a vehicle puts the two methods side by side over five years.
Related
Capital allowances on a vehicle
A capital allowance is tax relief on something you bought to keep and use, spread over years rather than deducted at once. You cannot claim capital allowances on a vehicle and use the mileage rate for it, so for most gig drivers this is a road not taken.
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Capital allowance
A capital allowance is tax relief on something you bought to keep and use in the business, such as a vehicle. Instead of deducting the whole cost in one year, you deduct a percentage of what is left each year.
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