Use a uniform? The tax man may want to pay you!
If you’re an employee who uses their own money to pay for work related items or travel, you might be surprised to know that you’re entitled to some money back from HMRC. It’s called Tax Relief For Employees. It’s not open to everyone though, and if your employer pays you expenses, or has provided you with alternative compensation, you don’t qualify.
Why is that relevant to our customers? Because if you have to wear a uniform for work – whether that’s a chef’s whites, a simple printed T-shirt with company branding or logos, or a nurse’s dress – you could claim back up to £500 towards the cost of looking after it.
If you think you’re eligible, here’s our quick guide however do ensure you seek professional guidance and advice.
When can I claim?
As long as you paid tax during the same year that the money was spent, you can claim from HMRC. What you get is based on the rate of tax you’re paying. For example, a person who pays 20% tax would be allowed to claim £24 back on a work related spend of £120.
Before you claim tax relief, you have to be able to prove that what you’ve spent the money on is not for anything other than business use, and you’ll need to keep records of your spending for four years after the end of the tax year when the money was spent, which is the latest date for making a claim.
How can I claim?
If you’re claiming for up to £2,500, it’s fairly straightforward. If you use the self-assessment system, just declare it on there. If not, print and post a P87 form to HMRC. As long as you’ve had a validated claim from the previous year, and your expenses come in under £1,000 (£2,500 in the case of subscriptions and professional fees), you can even phone HMRC and complete things verbally with an advisor. You’ll be repaid in the form of an adjusted tax code for the rest of the tax year.
Claims over £2,500 must be made through your self-assessment form. You’ll also get relief through an adjusted tax code over one or two tax years and receive a tax return form to complete.
How does this work for uniforms?
HMRC recognises that a uniform is part of your job, just as much as scissors are for a hairdresser, or a drill might be for a builder, so you can claim tax relief on costs involved in cleaning, replacing or repairing your uniform.
While you don’t get tax relief on what it costs you to purchase your work clothing (that’s something different called Capital Allowance), you can make a claim based on what you’ve spent, as long you’ve got receipts, or for a flat rate deduction. These flat rates are fixed amounts, which HMRC sets each year based on what spending they’ve seen from people in different professions. If you’re not one of the occupations on their list, you can claim for a single rate of £60 per year. Claiming a flat rate means you don’t need to keep your receipts, either.
I want to know more!
Of course you do! There are some fantastic guides on the internet. We’d recommend the easy to understand guide from Moneysaving Expert [http://www.moneysavingexpert.com/reclaim/uniform-tax-rebate]. If it seems daunting to claim, you can even hire the people at Uniform Tax Rebate [https://www.uniformtaxrebate.co.uk] to make a claim on your behalf.
Once the forms are in, all you need to do is look forward to receiving your own little windfall, then sit back and thank the people at Banksford for giving you not only top quality branded catering and hospitality uniforms, but a way to get paid for what you’re already doing to look after them in the fantastic condition we provide them in.
The information in this article is for general information and is not legal or professional advice.