FLAT RATE EXPENSES FOR EMPLOYEES
Your Tax Shop, Tameside can advise If you are an employee you may be able to claim back tax relief if the following circumstances apply to you:
- You use your own money for items that you must buy for your job
- You only use the purchased items for work purposes
You may not claim tax relief if your employer gives you either:
- All the money back
- An alternative, for example your employer gives you a laptop, but you want a different type or model
If you are claiming for the current year HM Revenue and Customs will usually make any adjustments needed through your tax code but if your claiming for previous years, they may send you a self-assessment tax return to be completed. You must keep records of what you have spent, also you must claim within four years of the end of the tax year of which you have spent the money. Our team at Your Tax Shop in Ashton under Lyne advises that all records you claim tax relief on should be kept up to a minimum of six years.
Here is a brief overview of the five main categories in which you would find claimable expenses:
Uniforms, work clothing and tools
Most companies will provide their employees with items such as uniforms, safety wear, tools and any other necessary equipment in which you will use daily. When you are due to replace these items, you would be able to claim tax relief on this if your receipts have been kept, although if the case of the employee having to purchase these items themselves for the first time the initial cost would not be able to be claimed.
There are two ways you can go about claiming these expenses, the first which previously stated that you would need to keep all records of any expenses, the second would be an agreed amount as pet the Flat rate expense(for guidance on further information on flat rate expense please follow the link https://www.gov.uk/guidance/job-expenses-for-uniforms-work-clothing-and-tools ).
Vehicles you use for work
In some cases, you can claim tax relief if you use cars, vans, motorcycles or bikes for work, although traveling to and from your main place of work cannot be included unless it’s on a temporary basis. How much you can claim depends on whether you are using either a vehicle that you have purchases or leased with your own money or a vehicle that your employer has purchases or leased.
Using your own vehicle for work you may be able to claim tax relief on an approved mileage rate, but you cannot claim for separate things such as fuel, electricity, road tax, MOTs or repairs. In order to be able to calculate how much relief you can claim for each tax year you should keep records of all dates and mileage for your work journeys, add up the mileage for each vehicle type separately that you’ve used for work and take away any amount your employer pays you towards your cost (most commonly known as ‘Mileage allowance’). Below is a table of approved mileage rates which can be found on the Gov.uk website:
When you are using a company vehicle you can only claim the money you’ve spent on fuel and electricity for your business trips only, you must keep all records showing the actual cost of fuel along with any amounts your employer has already reimburse you for this as you can only claim tax relief on the difference.
Travel and overnight expenses
There may be times that your employer will need you to work away from home and advise that you will need to stay overnight, in such cases you may be able tax relief claim on the money you’ve spent on some expenses. The main expenses that are claimed for are things like public transport cost, accommodation if you must stay overnight, food and drink of a reasonable amount, congestion charges and tolls, parking fees, business phone calls and printing.
Professional Fees and Subscriptions
You can claim tax relief on fees or subscriptions you pay to approved professional organisations but only if you must have them in relation to your job. You cannot claim tax relief on fees or subscriptions such as life memberships of any amount your employer has paid on your behalf already.
Working at home
You may also be able to claim tax relief on some of the bills you pay if you are working from home on a regular basis, although if you have chosen to work from home voluntarily you cannot claim any tax relief.
You can only claim for things to do with your work such as business telephone calls or the extra costs of your utility bills to cover your work area but would not be able to claim things that you use for both business and personal use, for example rent and broadband costs. Alternatively, your employer can pay you up to £4 a week (£18 per month) to cover any additional costs you accrue in working from home in which case you would not have to keep records of additional expenses.
Should you require any help in this area please contact one of the team at Your Tax Shop, based in Ashton-Under-Lyne town centre.