Deadline approaches to claim tax relief on expenses
1 April: Employees need to act now if they want to claim tax relief on employment expenses before the deadline for the 2015/16 tax year expires on 5 April, urges ICAEW’s Tax Faculty.
As HMRC confirms that those working from home due to the coronavirus pandemic do fall within rules governing home working expenses, ICAEW’s Tax Faculty is providing a timely reminder that the rules for employees claiming tax relief on employment expenses are tightly drawn and limited relief is available.
Claims can be backdated for four years which means employees have until 5 April 2020 to make a claim before the 2015/16 tax year expires. The Tax Faculty recommends that, where possible, claims are made online. This is especially important at the moment to ensure HMRC receives any claim by the deadline, as the regulator's helplines are under considerable pressure and claims made by post are likely to be delayed.
Tax relief may be available for expenses not reimbursed by employers, such as:
- working at home;
- uniforms, work clothing and tools;
- vehicles used for work;
- travel and overnight expenses;
- professional fees and subscriptions; and
- buying other equipment.
Flat rate expenses for uniforms, work clothing and tools are available to those working in certain occupations and industries.
Other points to bear in mind include:
- Employees should review claims each year and provide updated claim figures to HMRC.
- Claims for tax relief on work-related expenses above £2,500 must be made by completing a self assessment tax return.
- Agents cannot file the online form on behalf of clients.
The Tax Faculty urges caution to those considering using a ‘high volume repayment agent’ – many of which take a large percentage of any refund due.
If help is needed the Faculty recommends using an ICAEW member firm or, for those that cannot afford paid for advice, one of the tax charities, such as TaxAid or Tax Help for Older People.