New announcement. Learn more

CHARTERED ACCOUNTANTS (ICAEW)

News and advice to help make your property business a success

Landlords TaxProperty TaxLandlords Tax ReturnsLandlords AccountsProperty Tax ReturnProperty AccountsLandlords FinancialLandlords AccountantTax ReturnsTaxChartered AccountantsOnline AccountantOnline BookkeepingOnline Tax ReturnsYour Online AccountantYour Online BookkeeperVATBusinessadviceHMRCAccountingCashflowDividendsExpensesPAYEPropertyProperty AccountantSmallbusinessBusinesstipsCapital Gains TaxFHLsFurnished Holiday LettingsIhtexemptionsIncome TaxInheritance TaxNICSDLTTaxplanningCgtInvestment Property TaxLandlord RepairsPensionProperty bookkeeperProperty LettingTax ReliefTaxreturnVAT invoiceAllowable Business ExpensesAnnual Exempt AmountBad Debt Tax ReliefBusiness ExpensesBusiness RateCapital AllowancesCapital GainsCapital gains tax propertyCashbasisChild BenefitComplianceDeductibleexpensesDisincorporationEmployment AllowanceFinanceFinancialmanagementGiftsHMRC complaintsHoliday Lets TaxISALettingsMaking Tax DigitalMakingTaxDigitalMileage AllowanceMobilephonesNational InsuranceOverlapreliefPartnershipPartnershipbusinessesPprProperty Company TaxProperty Tax Deductible ExpensesPropertyallowanceReimbursedexpensesRent a Room ReliefRentalResidence ReliefSmall BusinessTax free incomeTimetoPay60 day capital gains limitAbolitionclass2AccrualsbasisAcquisitionsAdvisoryfuelratesAIAirBnBAlphabet sharesAmapAnnual Tax on Enveloped DwellingsAppealArtificial intelligenceAssessmentAsset disposalAssociated CompanyAssociated Company Tax RulesAutumnstatementBad DebtBaddebtsBadgesoftradeBADRBeancounterBenefits in KindBreakeven PointBudgetBusiness adviceBusiness asset defermentBusiness coachBusiness ContinuityBusiness EntertainmentBusiness RatesBusiness Rates ReliefBusiness tipsBusinessgrowthBusinesstypesBuy or Lease EquipmentBuytoletCapital Allowances for CarsCapital GainCapitalallowancesCapitalexpenditureCar Capital AllowancesCarry Back LossesChange of Tax BasisChatGPTCIS SchemeClass 2 NICCommon TenantCompanies ExpenditureCompanies HouseCompany Account DeadlinesCompany Account FilingCompany Strike OffCompany Tax Efficient PropertyCompanyassociationCompanyloanstaxfreeCompulsory Strike OffConstruction Industry SchemeContacthmrcContentmarketingContributionsCorporation Tax LossesCorporation Tax New RegimeCorporation Tax RatesCorporationTaxCostsCryptocurrencyCustomerlistimplicationsDeductible Business ExpensesDeductionsDemergerDepreciationDevelopmentDirectorsDirectors LoansDirectorsloansDisallowable Business ExpensesDiscoveryDividend allowanceDividend Allowance ReductionDividend PlanningDividendallowanceDLADomestic Items Tax ReliefDormantcompanyEISEmployee DiscountEmployee managementEmployeecompensationpaymentsEmployeeOwnershipTrustEndoflifeplanningEnquiryEnterpriseResourcePlanningEntertainmentEntrepreneurmindsetEquityExpenses Allowed For TaxExtrabenefitEyetestsFlat Rate SchemeFlippingFurnished Holiday Lets TaxGift AidGift AllowanceGrowthhacksHelp to pay tax billsHICBCHMO Licensing FeesHoldoverreliefHoliday Lettings TaxHow to apply for a Business LoanHow to Extract ProfitHumourHybridIllegaldividendsIncomeIncome and GainsInflationary GainsInfluencersInheritance Tax Nil Rate BandInterest RatesInterestreliefInterestrestrictionIR35Joint TenantKeypersoninsuranceLandlords Self AssessmentLate vat registrationLBTTLeadgenerationLeadmagnetLeanbusinessmodelLetting Agent DisbursementsLetting Agent RecharresLettings ReliefLifetime LimitLimitedcompanyLiquidation DemergerLoaninterestLong Lets TaxLongserviceLTTMainresidencereliefManaged LetsManagement accountingMaritalhomedivorceMarriage allowanceMarriageallowanceMileage paymentMinimumwageMixedusesdltMortgage costsMortgage Interest ReliefNew propertyNewcompanycarfuelratesNewnicrulesNIC 2023 to 2024NIC savingsNicdisregardNicreductionNMWNmwerrorsNon Allowable Business ExpensesNon-taxableNudgeletterOptiontotaxvatOverpayment ReliefOverseas propertiesPaperformPartnership schemesParttimePatternofoccupancyPAYE by Direct DebitPayrollingPenaltypointsPension Payments Tax ReliefPensioncontributionsPensionsPerformance-reviewsPeriodofgracePeriodsofabsencePersonal ExpensesPersonal financePersonalallowancePersonalguaranteesPostcessationreliefPretradingexpensesProfitProfit-and-lossProfitAndLossProperty AllowanceProperty Development CompanyProperty IncorporationProperty Investment CompanyProperty investor accountsProperty investor tax tipsProperty Rental BusinessProperty TradingPropertycompanyR40Recharges by Estate AgentsRegularpaymentsReliefRent your driveRentaroomResearch & DevolopmentResidential property gainsResidentialsdltRetail stock controlRetainedprofitsRevenueRoom for rent taxRtiSASalarySavingsSDLT changesSection 455 TaxSection455taxSelective Licences LandlordsSelf AssessmentSelf-employednicSelfemployedSelling OnlineSeperationServicechargesSettlementslegislationSimplified ExpensesSmallbizSmallbusinessratereliefSoftwareSole TraderSpring BudgetStaffpartiesStamp dutyStudent Loan DeductionsSuccessJourneyTax Allowance on DrivewaysTax AllowancesTax BreakTax CodesTax DeadlinesTax DeductionsTax Filing DeadlinesTax Free ChildcareTax ImplicationsTax on Company VansTax positionTax RefundTax tips for landlordsTaxbillpaymentsTaxconsequencesTaxincentivesTaxpositionTaxpositionassetsTaxreliefTaxreliefsTaxsesTerminationpaymentsTipsTrade professionalTrading lossesTrainingTransfer AssetsTransfer Assets Between SpousesUmbrellacompanyUndisclosedincomeUnpaid RentVAT Bad Debt ReliefVAT DeadlinesVAT DisbursementsVAT PenaltiesVAT registrationVAT Reverse ChargeVatpenaltiesVatregisteredVatregistrationthresholdWellbeingWorking from home
TAGS

Claiming tax relief on work clothes

Many employees are required to wear a uniform or particular type of clothing whilst at work. Even where there is no set uniform, many have clothes that they wear only to work and regard as ‘work clothes’ they would not otherwise wear. Tax relief is available, but only for the cost of cleaning, repairing or replacing where the employee pays the cost themselves and does not receive reimbursement from the employer.

The cost of the initial purchase of ordinary clothing cannot be claimed because a tax deduction is only available for employment expenses under the 'wholly, exclusively and necessarily incurred in the performance of the duties of the employment' rule. As such, general clothing, even if worn at work, is not eligible unless it is clearly distinctive or protective. For example, the criteria would not be met should the company require an employee to wear a suit or tie at work, but would be met if the clothing was a lab coat for scientists as that would be necessary for the performance of their work duties.

Should an employee be able to claim, there are two methods available, either by claiming the actual cost incurred or by using the flat rate expenses method – the latter being the more straightforward calculation (do not confuse this scheme with the VAT flat rate scheme for businesses). If claiming under the actual cost rules, receipts must be retained as proof. In comparison, the flat rate method needs no receipt retention as the claim is a set amount.

HMRC’s Employment Income Manual sets out a table of permissible fixed rate deductions. The amount varies depending upon the industry and job role, from £1,022 a year for airline pilots to £60 a year for various categories of workers. For example, a joiner can claim £140. If an employee does not fit into a specific category, the allowance is £60 per year.

How to claim

There is no need to claim if the expense is already included in the tax code. If the claim is being made for the first time and a self assessment annual return is not submitted, a P87 form should be used. If a self assessment tax return is completed, the claim is made on page E1 of the return. On acceptance, the claim will be carried forward and

included in subsequent notices of coding. Claims can be backdated for up to four tax years and in this instance HMRC will either adjust the PAYE code for the current year or provide a tax refund.

Employer-provided clothing

Some businesses provide work clothing and here we are looking to see whether the provision is caught by the benefit in kind rules subject to income tax and NIC and reportable via form P11D by the company. Note that the tax year ending 5 April 2026 will be the last year employers will be required to file P11Ds, instead being required to report and collect income tax and Class 1A National Insurance on benefits through the payroll in real time.

Work clothing provided by an employer is only tax free if the clothing is necessary for the employee’s role and used solely for work purposes and, again, we are looking at such items as safety helmets, overalls and protective gear for construction workers. Uniforms that are clearly distinctive and cannot be worn outside of work are also not taxable including clothing with a permanent and visible logo of the employer (e.g. airline uniforms and branded retail staff uniform showing the logo of the business).

Practical point

Employers can enter into a PAYE Settlement Agreement with HMRC to simplify the reporting of minor, irregular or impracticable benefits, including clothing that might fall into these categories. This allows the employer to settle the tax and NICs on behalf of the employees.