Tool and equipment hire

Yes

Hiring tools or equipment for a job is a direct business expense, fully deductible in the tax year you pay it. No capital allowances needed. It is not a purchase.

Common questions

Can I claim the cost of hiring a cement mixer for a job?

Yes. Plant and equipment hire is a revenue expense. Keep the hire invoice and match it to the job.

I recharge the hire cost to my client with a mark-up. How does that work for tax?

The hire invoice is your deductible cost, and the amount you charge the client, mark-up included, is part of your income. Record both. Do not net one off against the other.

The hire company added a damage waiver, fuel and a delivery charge. Claimable?

Yes. Charges that are part of the commercial cost of the hire, waivers, fuel, cleaning and delivery, are deductible along with the hire itself.

Watch out for

Long-term hire agreements where you own the item at the end (hire purchase) are treated as a purchase for tax purposes, not hire.
A returned deposit is not an expense. If the hire company withholds a deposit for damage, the amount kept becomes a deductible cost at that point.
Hiring kit you then also use personally: claim the business share of the hire, the same apportionment rule as any mixed-use cost.

Common mistakes

Netting a recharged hire against the client's payment instead of recording the cost and the income separately. The profit is the same but the records are wrong, and it understates turnover.
Claiming hire purchase payments as hire. Ownership passes to you, so it is a purchase: capital allowances on traditional accounting, a normal expense on cash basis.

Cash basis vs traditional accounting

Hire is a day-to-day cost on both methods: deduct in the period you paid (cash basis) or the period the hire relates to (traditional accounting). Capital allowances never come into it, because you never own the kit.