Revenue Note for Guidance

The content shown on this page is a Note for Guidance produced by the Irish Revenue Commissioners. To view the section of legislation to which the Note for Guidance applies, click the link below:

Revenue Note for Guidance

375 Limit on renewals allowance for cars

This section provides that the amount of the cost of a car in excess of the specified amount is to be disregarded in computing the renewal allowance in respect of the car.

If the car costs more than the specified amount, the allowance is to be computed as if the cost of the car were the specified amount. Where, however, the car is replaced in its turn (whether the car then bought costs more or less than the specified amount) the renewals allowance on that occasion is to be computed on the basis that its value or sale proceeds are scaled down in the proportion which the specified amount bears to its cost.

Example

Cost of car A (purchased 1 January 2002)

€25,000 restricted to

€22,000

Cost of car B (purchased June, 2002)

less proceeds of car A €18,000

€30,000

restricted to

€15,840

(22,000 × 18,000)


(25,000)

Renewals allowance

€14,160

Relevant Date: Finance Act 2020