Finance and growth
When to sell or replace a hire machine: the warning signs, keep-versus-replace numbers, depreciation, capital allowances and how to sell for the best price.
Key takeaways
| Keep | Replace |
|---|---|
| Expected repairs and servicing next 12–24 months | Finance or cost of the replacement |
| Expected downtime and lost hire | Higher rates or utilisation from a newer machine |
| Resale value in 12–24 months (lower) | Resale value now (higher) |
| No new finance commitment | New finance payments and deposit |
Use the utilisation and break-even calculator for each option.
Machines lose value fastest in the first years, then more slowly. Residual value depends on brand, hours, condition, service history and demand for that model. Popular small excavators from mainstream brands with full service records hold value best. Keep records and photos: they're worth money at resale.
| Allowance | Summary |
|---|---|
| Annual Investment Allowance | 100% relief on qualifying plant up to £1 million a year, new or used |
| First-year allowance (from 1 Jan 2026) | 40% on new main-rate plant, including plant for hire or leasing; not second-hand |
| Full expensing | 100% for companies on new main-rate plant, but excludes plant for leasing/hire |
| Writing-down allowance | Main rate 14% a year from April 2026 (previously 18%) |
Summary only. How allowances apply depends on your business structure and finance type. Check with your accountant.
Selling a machine can trigger a balancing charge or allowance depending on what you claimed. Plan sales with your accountant, especially near your year end.
| Route | Pros | Cons |
|---|---|---|
| Part-exchange with a dealer | Quick, simple | Usually lowest price |
| Private sale or online listing | Better price | Time, buyer checks, payment risk |
| Auction | Fast, wide market | Fees; price uncertain |
| Sell to a customer who hires it | Easy, they know the machine | May lose their hires |
Rather than replacing machines only when they fail, plan a cycle, for example replacing each small excavator after a set number of years or hours. Stagger purchases so finance and replacement costs are spread out. Finance terms that end before major repairs usually begin make the cycle easier.
Replacing a machine?
Plant Hire Finance, our sister site, introduces you to a specialist broker for new and used plant and asset refinance.
Plant Hire Finance is run by the same team as this guide. It is an introducer, not a lender or broker. Finance is subject to status and available to UK businesses only.
FAQs
Keep going
Utilisation and break-even for hire equipment
Calculate break-even utilisation for each machine.
Read guide →
Finance
Hire purchase, leases and refinance for new hire firms.
Read guide →
Maintenance
Service intervals, off-hire checks and records.
Read guide →
Plant hire KPIs and monthly reporting
The numbers to review every month on one page.
Read guide →
This guide is general information for people setting up a plant hire business in the UK. It is not legal, tax, insurance or financial advice. Rules and thresholds change, so check current guidance on GOV.UK and take advice from an accountant, solicitor or broker before acting.