When you cannot claim the full cost of an asset upfront, the Writing Down Allowance lets you deduct a percentage of its value each year. Here is how the 18% main pool and 6% special rate pool work for 2025/26.
Not every business purchase can be written off against tax in one go. When the cost of an asset is too large for the Annual Investment Allowance, or when an asset such as a car is excluded from it altogether, the Writing Down Allowance is the mechanism that spreads the tax relief over several years. It is one of the foundational rules of UK capital allowances, and for any sole trader or business that owns equipment, vehicles or fixtures, understanding the difference between the 18 per cent and 6 per cent rates is essential to claiming the right amount.
The Writing Down Allowance works on a reducing balance. Rather than claiming a fixed amount each year, you claim a percentage of whatever is left in the pool. That means the deduction is largest in the early years and tails off over time, so an asset is never fully written off in a single year through the WDA alone. This is deliberately slower than the Annual Investment Allowance, which is why most businesses reach for the AIA first.
Capital allowances exist because the everyday rule of deducting business costs from profit does not apply to capital items. You cannot simply deduct the cost of a £15,000 van as a running expense; instead, you claim capital allowances on it. The Writing Down Allowance is the standard capital allowance for plant and machinery that is not relieved in full through another mechanism.
The system groups assets into pools rather than tracking each item separately. You add the cost of qualifying assets to the relevant pool, claim the WDA percentage on the pool's balance each year, and the remaining balance carries forward to the next year. When you sell or dispose of an asset, the sale proceeds are deducted from the pool. This pooling approach keeps the arithmetic manageable even for a business with dozens of items.
There are three main pools to know about: the main pool (18 per cent), the special rate pool (6 per cent), and single-asset pools used for items with private use or a short life. Each is written down at its own rate.
The two headline rates have been stable for several years, and they remain unchanged for 2025/26.
| Pool | WDA rate | Typical contents |
|---|---|---|
| Main pool | 18% | Most plant and machinery, tools, computers, furniture, vans, cars at 50g/km CO2 or below |
| Special rate pool | 6% | Integral features, long-life assets, thermal insulation, cars over 50g/km CO2 |
| Single-asset pool | 18% or 6% | Assets with private use; short-life assets |
The split between the two pools matters because the 18 per cent main pool delivers tax relief roughly three times faster than the 6 per cent special rate pool. An air-conditioning system or a high-emission car sits in the slow lane, while a laptop or a van sits in the fast lane. Allocating assets to the correct pool is not optional; HMRC sets out which category each asset falls into.
Any business that pays UK tax on its profits can claim Writing Down Allowances: sole traders, partnerships and limited companies alike. The rates and pooling rules are identical across all of them. Sole traders claim WDAs against their trading profits, and the allowances flow through to the sole trader tax calculation.
Qualifying assets are broadly plant and machinery used in the business: equipment, tools, machinery, computers and software, commercial vehicles, office furniture, and certain fixtures within commercial premises. Buildings themselves, land, and most structures do not qualify for plant and machinery allowances, though the separate Structures and Buildings Allowance may apply to them.
For sole traders, there is one important wrinkle. If an asset is used partly for private purposes, for example a car used for both business and personal journeys, the asset goes into its own single-asset pool and the WDA is restricted to the business-use percentage. A car used 70 per cent for business and emitting 45g/km would attract 70 per cent of the 18 per cent main rate.
Consider Marcus, a self-employed photographer. At the start of 2025/26 he has a main pool balance of £8,000 carried forward from previous years. During the year he buys a new van for £20,000 and a high-end editing computer for £3,000.
First, the Annual Investment Allowance. The van and computer (£23,000 combined) qualify for the AIA, so Marcus can deduct 100 per cent of their cost immediately, well within the £1 million AIA limit. He chooses to do so, claiming a £23,000 deduction in the year.
That leaves only the £8,000 carried-forward balance in the main pool. He claims the Writing Down Allowance on it: £8,000 x 18% = £1,440.
His total capital allowances for the year are £23,000 (AIA) plus £1,440 (WDA) = £24,440. The main pool balance carried forward to 2026/27 is £8,000 minus £1,440 = £6,560, which will itself be written down at 18 per cent next year.
If instead Marcus had spent more than the £1 million AIA limit, or had bought a car (which never qualifies for the AIA), the excess or the car would have gone straight into the relevant pool and attracted only the WDA. The sole trader calculator helps you see how these deductions reduce your taxable profit and therefore your tax and Class 4 National Insurance.
The Writing Down Allowance rarely operates alone. It sits within a wider framework of capital allowances, and the order in which they apply determines your tax bill.
The Annual Investment Allowance is almost always claimed first. It gives 100 per cent relief on up to £1 million of qualifying plant and machinery in the year of purchase. Only spending above that limit, or on assets the AIA does not cover (most notably cars), falls back on the WDA. Because the AIA front-loads the relief, claiming it first and leaving older balances to the WDA is usually the most tax-efficient approach.
Limited companies can also claim full expensing (100 per cent for main-rate plant and machinery) and a 50 per cent first-year allowance for special rate assets on qualifying new equipment. These sit alongside the AIA. Sole traders cannot claim full expensing, so for the self-employed the AIA and the WDA are the two main tools. Any balance not relieved by these upfront allowances drops into the pools and is written down at 18 per cent or 6 per cent thereafter.
To stop pool balances from being written down forever in ever-smaller slices, the small pools allowance lets you clear any main or special rate pool balance of £1,000 or less in a single year. So if Marcus's main pool fell to £900, he could write off the whole £900 rather than claiming £162 (18 per cent) and carrying forward £738.
When you sell an asset, the proceeds reduce the pool. If selling assets reduces a pool below zero, a balancing charge adds the excess back to your profits. When a business ceases, a balancing allowance or charge clears the remaining pool. These adjustments interact directly with the WDA balances you have built up over the years.
For the fuller picture of how these pieces fit together, see the capital allowances overview, which explains the whole framework from the AIA down to the WDA.
Capital allowances, including the WDA, are not compulsory. You can claim less than the maximum, or none at all, in a given year. This flexibility matters for sole traders whose profits sit near the Personal Allowance: claiming a smaller WDA can preserve tax-free allowances that would otherwise be wasted, leaving a larger pool balance to relieve in a more profitable future year. Because the pool simply carries forward, no relief is lost; it is merely deferred.
The Writing Down Allowance is the patient cousin of the Annual Investment Allowance. It spreads relief out year after year, which is exactly why getting your assets into the right pool, at the right rate, pays off over the life of the equipment.
If you own equipment, vehicles or commercial fixtures, the practical first step is to identify which pool each asset belongs in and whether the AIA can relieve it in full instead. From there, the sole trader calculator lets you model how your capital allowances reduce taxable profit across the year.
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