If you incur expenses in doing your job, you may be able to claim tax relief. While the rules governing the availability of relief are strict, the process for claiming relief where it is available is relatively straightforward.
Availability of Tax Relief
Expenses that may qualify for tax relief include travel expenses incurred in relation to business travel, mileage allowances if you use your own car for business journeys, the cost of professional fees or subscriptions and the additional costs of working at home. However, it should be noted that the rules are strict and where a deduction is not granted by a specific provision, the general rule only permits a deduction for expenses incurred wholly, exclusively and necessarily in the performance of the duties of your employment.
Claiming Relief
If you are eligible to claim tax relief for employment expenses, there are various ways in which this can be done.
Route 1: Claim Online
You may be able to claim online.
Before making a claim, you can check whether you can use the online service by using the tool which can be found at www.tax.service.gov.uk/claim-tax-relief-expenses. You cannot make a claim online if:
- you are making the claim on behalf of someone else;
- you complete a self-assessment tax return;
- you are claiming tax relief for expenses of more than £2,500; or
- you are making a claim for more than five different jobs.
If you are eligible to use the online claim service, you will need to include all the expenses that you want to claim for the relevant tax year. The total shown on the summary page will be used to work out the tax relief to which you are entitled.
The online service is available on the Gov.uk website at www.gov.uk/guidance/claim-income-tax-relief-for-your-employment-expenses-p87.
Route 2: Postal Claim
You must make a claim by post if you are claiming on behalf of someone else or you are claiming relief for expenses for more than five jobs. Postal claims are only accepted on form P87, which is available to download on the Gov.uk website at www.gov.uk/government/publications/claim-income-tax-relief-for-your-employment-expenses-by-post.
It should be noted that the following information is mandatory, and the form will be rejected if it is not included:
- all section 1 information with the exception of title and contact phone number;
- the employer’s PAYE reference in section 2; and
- the type of industry in respect of which expenses are being claimed in section 2.
Route 3: Telephone Claims
A claim can be made by phone (0300 200 3300) if a claim has been made in previous years for the same expense type and your total expenses are either less than £1,000 or less than £2,500 for professional fees and subscriptions.
Claims cannot be made by phone for expenses incurred as a result of working from home.
Route 4: Self-Assessment Tax Return
If you complete a self-assessment tax return, you should claim relief for employment expenses in the employment pages of your tax return.
Partner Note: ITEPA 2003, Pt. 5.
