Claiming Tax Relief on Employment Expenses: What You Need to Know
If you’re an employee who incurs work-related expenses that haven’t been reimbursed by your employer, you could be eligible for Income Tax relief. Understanding what you can claim and how to do it correctly can help you reduce your tax bill and get back the money you’re entitled to.
How to Claim Employment Expenses Tax Relief
If you file a Self-Assessment tax return, employment expenses should be included on the employment pages of your return. However, for employees who do not file a Self-Assessment, the claim can be made using HMRC’s online P87 form.
HMRC had temporarily suspended the P87 online form due to a surge in ineligible claims, but it is now available again. When making a claim, you must provide evidence of the expenses incurred.
What Expenses Can You Claim Tax Relief On?
You can claim tax relief on the following work-related expenses:
- Working from home costs – If your employment contract requires you to work from home, you can claim for additional costs incurred. Read our guide to tax relief for working from home.
- Repairing or replacing a uniform or small tools – If you’re required to wear a uniform or use specific tools for work, the cost of maintaining or replacing them may be eligible for tax relief.
- Travel for business journeys – This applies to work-related travel but not commuting to and from your regular place of work.
- Professional fees and subscriptions – If you’re required to be a member of a professional body for work, the fees you pay could be tax-deductible.
How Much Can You Claim?
The amount of relief you can claim depends on the type of expense and your tax rate. You will typically receive tax relief at your marginal tax rate, meaning:
- Basic rate taxpayers (20%) get 20p back for every £1 spent on eligible expenses.
- Higher rate taxpayers (40%) get 40p back for every £1 spent.
Key Deadlines for Claims
You can backdate your claim up to four years, so if you’ve overlooked eligible expenses in previous tax years, you may still be able to claim relief.
Why You Should Act Now
With tax laws and HMRC’s processes constantly evolving, ensuring that you claim the right expenses correctly is crucial. Submitting accurate claims with supporting evidence helps avoid delays or rejections from HMRC.
Need Help With Your Tax Relief Claim?
Navigating employment expense claims can be complex, but A&C Chartered Accountants can help ensure you maximise your tax relief while staying compliant with HMRC rules. Contact us today for expert guidance on making your claim effectively.