SolvedCA23145 | Plant and machinery allowance (PMA): First Year Allowance (FYA): Zero emission goods vehicles: Scope
From HM Revenue & Customs · Capital Allowances Manual
CAA01/S45DA/S45DB and S212T
Legislation was introduced in Finance (No3) Act 2010 to give 100% FYAs on zero-emission goods vehicles. The majority of businesses are eligible for this allowance provided that, at the time the claim is made, the business is not, or is not part of, an undertaking that is excluded from the relief (CA23146).
To qualify for the allowance the vehicle must be all of the following:
'unused and not second hand' (CA23117)
of a design primarily suited for the conveyance of goods or burden
of a description that cannot in any circumstances emit CO2 by being driven
registered for use on the road.
Expenditure on qualifying vehicles will be eligible providing all of the following are true:
total expenditure on qualifying vehicles over the 5 year period of the relief by an undertaking does not exceed €85 million CA23149
it has not been subsidised by a grant CA23147
it is incurred on or after 1 April 2010 for corporation tax and 6 April 2010 for income tax, and before 1 April 2025 for corporation tax and 6 April 2025 for income tax.
In addition the general exclusions, e.g. leasing, in CA23113 apply.
How to determine whether it emits zero-emissions
Vehicles only qualify for the relief if they cannot in any circumstances emit CO2 when driven. This includes vehicles propelled by an electric motor powered by an onboard electric storage battery or hydrogen fuel cell. Where a vehicle is fuelled by hydrogen as a substitute for a carbon based fossil fuel a claim for capital allowances will only be admitted if such a vehicle cannot also be directly powered by a carbon emitting fuel.
Hybrid vehicles may be driven by electric motor, with the battery being charged by an on-board fossil fuel generator, or by switching between electric motor and internal combustion engines. In both cases the vehicles may emit CO2 when driven and are not zero-emission.
What is a goods vehicle?
A goods vehicle is a vehicle primarily designed to convey goods or other burden on the road. It must be registered for use on the road, i.e. it must have a number plate. It can include vans and HGVs.
Zero-emission vehicles designed to do either of the following are not goods vehicles:
to carry passengers
to carry out specialist works such as mobile cranes or hoists.