Taxes Consolidation Act 1997 section 377

Limit on deductions, etc for hiring cars

Section 377 restricts the tax deduction available for the hire of a car where the car's original retail price exceeded the specified amount, scaling the allowable expense down in proportion.

• Applies to hire charges (other than hire-purchase) that would otherwise be deductible as a trading expense.
• Triggered only where the retail price of the car when new exceeded the specified amount.
• The allowable deduction is reduced in the proportion which the specified amount bears to the actual retail price.
• Mirrors the parallel restriction on capital allowances for expensive cars, ensuring consistency of treatment whether a car is bought or hired.