Answers · UK 2025/26

What capital allowances can I claim on a van in 2026/27?

A van counts as plant and machinery, so you can usually claim 100% of the cost in the year of purchase through the Annual Investment Allowance, up to the £1,000,000 limit. A company buying a £30,000 van can deduct the full £30,000 from profit, saving £7,500 at the 25% corporation tax rate.

Last updated: 7 June 2026Last reviewed: 7 June 2026How we verify

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For tax purposes a van is treated as plant and machinery, not as a car, which is important because cars face restricted allowances based on emissions while vans generally do not. This means you can normally claim the full cost of a van in the year you buy it through the Annual Investment Allowance (AIA), which gives a 100% deduction up to the £1,000,000 annual limit for 2026/27. A company buying a £30,000 van can therefore deduct the whole £30,000 from its taxable profit in that year, saving £7,500 if it pays the 25% main rate of corporation tax, or £5,700 at the 19% small profits rate. A sole trader claims the deduction against income at their marginal rate, but must restrict the claim for any private use of the van. New and unused vans bought by companies may alternatively qualify for full expensing, another 100% first-year allowance that does not use up the AIA limit. If you do not claim the full amount, the van goes into the main capital allowances pool and attracts writing-down allowances at 18% a year on a reducing balance. Electric vans and charging equipment can attract enhanced first-year allowances. When you sell or scrap the van, a balancing charge or balancing allowance adjusts for the difference between the sale proceeds and the unrelieved cost. VAT on a van is usually fully reclaimable if you are VAT-registered and use it for business, unlike cars. Use the corporation tax calculator to see the effect on your profit and tax.