23 Jul Are your Employees Eligible for Tax Relief?
No matter what business you’re part of, which boss you’re working for, or what tasks are given to you, you’ll have to shoulder your own expenses for events or other things related to your job from time to time. This isn’t unusual—most companies often ask their employees to shoulder expenses while working on certain tasks related (or even unrelated) to the job. These include paying for a client’s meal, their transportation from one meeting place to another, or gifts for loyal clients during the holidays.
However, while companies think nothing of asking their employees to do this, there may be some instances where an employer will not reimburse any expenses an employee shouldered on the job. Although you might think the only thing you can do if you find yourself in a similar situation is to mope and try to forget about it, there’s actually one way you can still claim these expenses: tax relief.
Tax relief explained
Think of tax relief as a parent that has your back if your older sibling (i.e. your employer) doesn’t give you the money they owe you, which means that you’ll be compensated justly at the end of the day. However, employees can only claim tax relief on travel expenses, fees and subscriptions, work at home cases, and the like.
If a certain expense an employee shouldered is deemed an acceptable qualifying expense, then you can assume that the debt will be paid off and can be claimed. The concept behind tax relief has to do with protecting employees from negligent or selfish employers, wherein the costs in question were only incurred in the course of performing one’s duties.
Employment expenses that are eligible for tax relief
Although it might seem like having a good reason to claim tax relief and a bit of proof to back it up is enough, you should know that seeking a claim can often come off as a strict test for those seeking just compensation.
To help you make your claim for just compensation, we’ve compiled a list of certain expenses that qualify for tax relief:
1. Travel expenses
Common for most or global businesses or franchises such as hotels, restaurants, or stores, travel expenses are often incurred by an employee on the premise of being repaid later on as the trip is strictly for business purposes only. Typically, this is the easiest expense to file a claim for, like plane tickets, receipts, and proof of meetings or training can be used to get tax relief.
2. Business mileage
This type of cost is usually incurred when employees use their own car or any other form of transportation to go somewhere they were ordered to by their employer or do certain things for the company. When claiming business mileage tax, employees can also be reimbursed for any other costs incurred on the same trip, such as parking, gas, or toll fees.
3. Fees and subscriptions
Typically, employers ask their subordinates to make certain subscriptions for the sake of being able to work better or meet certain standards. Certain fees and subscriptions can be used as the basis for tax relief as long as they are related to work and can be proven as such.
4. Partial reimbursement
In the case of partial reimbursement, this is a type of eligible cost for tax relief that usually happens when an employer or business does not pay the entire amount. This can be applied for by showing the receipt of the earlier reimbursement.
Accotax specializes in accounting for small businesses, get in touch today to see how we can