Most job-related expenses which are not reimbursed by employers - and are not claimed by employees via a tax return - now need to be claimed via a paper form. We covered this new approach in last month’s Employer Focus article Changes to claiming tax relief for employment expenses, including the requirement for evidence of expenses to be submitted as part of the claim.

However, a digital service for claiming Flat Rate Expenses has now gone live, which should simplify the process for employees wanting to claim tax relief in respect of uniforms, specialist work clothing, or tools they need to do their jobs.

What are Flat Rate Expenses?

Flat Rate Expenses are fixed deductions which provide tax relief to employees in certain jobs for the costs incurred in replacing, cleaning or maintaining:

• work uniforms (which identify a particular occupation), 
• specialist work clothing (eg overalls or protective boots), or
• tools.

How much are they worth?

The amount of tax relief available varies by industry and by job, and details of the amount workers can claim are shown as part of the new claims service.

For instance, nurses may be eligible to claim £125 per year if they have to provide or wash their uniforms themselves. That deduction would be worth £25 to a nurse paying the basic rate of tax, and £50 to a higher rate taxpayer.

For those whose jobs don’t fall into one of these categories, a standard deduction of £60 per year may be available, saving £12 for a basic rate taxpayer and £24 for those paying the higher rate.

What don’t Flat Rate Expenses cover?

No tax relief is available to employees in respect of replacing or washing ‘everyday clothing’ worn for work – ie clothing which doesn’t mark them out as doing a particular job in the way a police officer or nurse’s uniform would. This applies even if they have to wear ‘on brand’ clothing which matches the employer’s colours.

No deduction for the provision of work clothing, uniforms or tools is available to employees whose employer provides all the necessary clothing and equipment for their jobs. However, a flat rate deduction should be available to cover the costs of laundering employer-provided clothing, unless the employer also provides a washing service for workwear.

No tax relief is available to employees for self-provided Personal Protective Equipment (PPE) – if it is legally required under Health & Safety legislation for the employee to do their job, the employer should either provide it, or reimburse the employee (tax-free) for purchasing their own PPE.

Can you claim a higher amount?

The new digital service starts with an eligibility checker, which allows employees to check that the online claim route is the appropriate route for their claim. But claiming Flat Rate Expenses isn’t the only way to get tax relief for costs relating to clothing and tools – employees can claim the actual costs incurred instead. Those wishing to do so will need to submit records of the actual expenses incurred via the paper expense claim route, as covered in last month’s Employer Focus.

This article reflects the position at the date of publication shown above. If you are reading this at a later date you are advised to check that that position has not changed in the time since.   

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