Full expensing calculator, 2026/27
Full expensing lets limited companies deduct 100% of qualifying new plant and machinery from profits in the year of purchase. Enter your spend and profit level to see the immediate corporation tax saving for 2026/27.
The full expensing calculator runs on the rates and thresholds HMRC has published for the 2026/27 tax year, so the figures you see reflect the position your company is actually filing on rather than a historic set of bands. Change any input and the result recalculates immediately, with no sign-up and nothing sent anywhere.
If you are a director of a UK limited company, use it as a first look before a decision rather than as the decision itself. Full expensing gives a 100.0% first-year deduction for new, unused main pool plant and machinery bought by a company (not sole traders or partnerships). Real company positions bring in other income, reliefs, group structures and prior year adjustments that a single page of inputs cannot see, which is why the workings are written out below under corporation tax & limited company. Read those, then check the numbers against your own accounts, and speak to us if anything looks materially different from what you expected.
Last reviewed 12 September 2026 for the 2026/27 tax year. Reviewed by Waqas Sagar, Member of ICAEW, Fellow of ACCA, Fellow of AAT.
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Result, 2026/27
Full expensing deduction
100.0% of qualifying spendCorporation tax before deduction
Marginal relief (effective rate between 19% and 25%)Corporation tax after deduction
Marginal relief (effective rate between 19% and 25%)Corporation tax saved this year
Illustration only, figures are based on the rates you have selected and the information entered. Please check your own position with us before acting.
Estimates for the 2026/27 tax year using published GOV.UK rates. Switch between 2026/27 and 2025/26 above.
How this is calculated
Full expensing was made permanent from 1 April 2023 and gives a 100.0% first-year allowance on qualifying new main pool plant and machinery, so the whole cost reduces taxable profit in the year of purchase rather than being spread over several years through writing-down allowances.
The tax saving depends on your marginal corporation tax rate. Because the deduction can push profit down through the marginal relief band, a company with profit between £50,000 and £250,000 can see an effective saving above the headline 25% rate on the last pound of the deduction, closer to 26.5%.
For most companies with spend under £1,000,000 a year, the Annual Investment Allowance already gives a 100% deduction on almost everything including second-hand assets and cars are excluded from both reliefs, so full expensing mainly matters for larger new-asset purchases or once the AIA is used up.
What qualifies and what does not
Qualifying assets include new machinery, computer equipment, office furniture, vans and most tools used in the business. Cars, assets bought for leasing to someone else, and second-hand equipment are excluded from full expensing, though second-hand items can usually still qualify for the Annual Investment Allowance.
Special rate assets, such as integral building features, get a 50% first-year allowance instead of 100% under the equivalent special rate first-year relief, with the balance going into the special rate pool at a lower writing-down rate.
Watch the disposal rules
If you sell an asset that received full expensing, the full disposal proceeds are brought back into taxable profit as a balancing charge rather than being deducted from a pool, which can produce a larger than expected tax bill in the year of sale.
This makes full expensing most valuable for equipment you plan to keep and use to the end of its working life, and less attractive for assets you expect to trade in or sell on relatively quickly.
What this means for your company
Treat the result as a planning figure for the 2026/27 tax year. If it changes what you were about to do, take a director's salary, a dividend, a large asset purchase or a filing decision, check it against your own accounts first. We can review the position with you and confirm the tax treatment before you commit.
Frequently asked questions
What is full expensing?
Full expensing is a 100% first-year capital allowance for companies buying new, unused main pool plant and machinery, letting the whole cost reduce taxable profit immediately rather than over several years.
Can sole traders claim full expensing?
No. Full expensing is only available to companies within the charge to corporation tax. Sole traders and partnerships instead rely on the Annual Investment Allowance for equivalent 100% relief up to its limit.
Does full expensing apply to cars?
No. Cars are specifically excluded from full expensing, though electric cars can separately qualify for a 100% first-year allowance under different rules, and other cars go into the main or special rate pool.
What happens if I sell an asset that had full expensing?
The sale proceeds are added back as a balancing charge and taxed as if they were profit in the year of disposal, so selling soon after claiming full expensing can create an unexpectedly high tax bill.
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