Claiming for job related expenses

Employees who use their own money to buy things they need for their job can sometimes claim tax relief for the associated costs. It is usually only possible to claim tax relief for the cost of items used solely for work.

There is no tax relief available if your employer refunds any costs in full. In addition, you cannot claim tax relief if your employer has provided you with a suitable item, but you want a different or upgraded model. For example, you are provided with a mobile phone for your work, but you want to use a newer and more advanced model and pay for this yourself.

A claim for valid purchases can be made against receipts or as a ‘flat rate deduction’. The flat rate deductions are set amounts that HMRC has agreed are typically spent each year by employees in different occupations. They range from £60 to £140 depending on listed occupations. If your occupation isn’t listed, you may still be able to claim a standard annual amount of £60 in tax relief.

This means that basic rate taxpayers can claim back £12 (20% x £60) and higher rate taxpayers £24 (40% x £60) per year and claims can usually be backdated for up to 4 years. If you work in one of the listed occupations, you could claim back even more.

Planning note

Employees may also be able to claim tax relief for using their own vehicles, travel expenses, professional fees and for buying equipment to use as part of their employment. The rules regarding what can and cannot be claimed are not straightforward. We would be happy to help you review any job related expenses and to comment on what tax relief may be available.

Posted in HMRC notices

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