Budget Win - Leased vehicle expensing helps growth

RHA Public Affairs Manager Ashton Cull outlines how the Spring Budget's provision for full expensing of vehicles is a net gain for UK transport businesses. 

The decision to extend full expensing to leased vehicles and assets should prove a significant support to hauliers and coach operators, particularly those affected by higher interest rates. 

Full expensing has rightly been lauded as a game changer for investment by British businesses, and we are delighted the Chancellor has listened to our calls to extend this opportunity to more commercial vehicle operators.

Since the Autumn Statement, commercial vehicle operators can claim 100% capital allowances on any qualifying plant and machinery investments they purchased, including vehicles and warehousing equipment.

Capital allowances are a way of obtaining tax relief for some types of capital expenditure. They are treated in a similar way to other business expenses when calculating taxable profits.

Larger hauliers and coach operators with significant cash reserves could take advantage of this measure, but smaller operators who relied on leased vehicles were left out. In addition, these SMEs that are so vital to both the road haulage and coach travel industries were taking a significant financial hit from the effect of rising interest rates on their financing costs. Hauliers experienced a double impact from the return of the HGV Levy.

The RHA has been pushing hard for the extension of full expensing to leased assets to help support these businesses, and we are delighted to see the Chancellor has heeded those calls and look forward to seeing the details once the draft legislation is published. 

This vital support for hauliers and coach operators will mean that, when the UK economy is ready to grow again, our industry will be in a better position to help deliver that growth.