Claiming Tax Relief on Fees and Subscriptions to Professional Bodies... and Other Allowable Expenses
By Lucy Chadwick MVB MRCVS
As an employee under the PAYE system there are various expenses on which you can claim tax relief. Some of the most relevant things you can claim as a recent graduate are:
Subscriptions to professional bodies
Subscriptions to professional bodies e.g. RCVS retention fee, BVA subscription, BSAVA subscription, SPVS subscription. There a list of professional bodies whose subscriptions are allowed under the scheme so if you joined any other societies check out this list to see if they are allowed. http://www.hmrc.gov.uk/list3/ . You can only claim the tax back if you paid for them yourself NOT if your employer paid for them. As a basic rate tax payer you get 20% of the cost of these back in tax every year.
Washing your uniform
If you have to wash employer provided uniforms at home e.g consult coats/scrubs/overalls you can claim tax relief for the cost of doing this.
Using your car for work
If you use your own vehicle for work you may be able to claim tax relief on business mileage if your practice does not pay you the current approved rate of 45p per mile. This does not include commuting to and from your place of work. If your practice pays you more than the approved rate you will need to pay tax on the difference. Strict records need to be kept. See the guide on their website: http://www.hmrc.gov.uk/incometax/relief-mileage.htm
What you need to do...
In order to have these allowances added to your yearly tax free allowance you need to:
1) Write a cover letter explaining that you would like to claim tax relief and for which tax year.
2) Print and fill out p87 form http://www.hmrc.gov.uk/forms/p87.pdf . You need to fill out Section 1, Section 2 if claiming vehicle expenses, Section 4 if claiming professional subscriptions and uniform washing costs, and Section 6 which is a summary of the whole form. Handy tip: Make sure in Section 4 you put the full name of the professional body NOT the abbreviation (i.e. Royal College of Veterinary Surgeons NOT RCVS!)
3) If it is for a previous tax year photocopy your p11d form which your employer may have given you at end of tax year and attach (if you have it, you will not have one if you have not worked in the previous tax year i.e. new grads won’t have one or if you employer did not provide any benefits in kind to you e.g. car, accommodation etc)
4) Send them together to the postal address on the most recent correspondence from HMRC that you have received or the address found on their website: http://search2.hmrc.gov.uk/kbroker/hmrc/locator/locator.jsp?type=1
Once you have done this once HMRC will allow the same subscriptions every year without you having to reapply. They add it to your Personal Allowance to work out your tax code. You will see all tax relief listed on your 'PAYE Coding Notice' that is sent out each year, or sometimes more than once a year if your circumstances change. The cost of professional subscriptions may change year to year so it’s worth ringing them yearly to make sure they are allowing the right amount. Also if your employer pays any of them for you it is up to you to inform HMRC so they can adjust your tax code. You can claim tax relief on expenses for up to 4 years after they occurred.
http://www.hmrc.gov.uk/incometax/intro-tax-allow.htm#5 – an introduction to tax allowances and reliefs
http://www.hmrc.gov.uk/incometax/relief-tools.htm - tax relief for specialist tools or clothing
http://www.hmrc.gov.uk/incometax/relief-subs.htm - tax relief for professional fees and subscriptions
http://www.hmrc.gov.uk/incometax/how-to-get.htm - how to claim allowances and reliefs
This article is intended as a guide only and all information is liable to change. The author recommends that you check out the HMRC website or contact your local tax office for up to date information.
This article was very kindly provided by Lucy Chadwick, a vet and VetGrad member, who wished to share the information she had found. If you would like to contribute an article or resource to the VetGrad site please CONTACT US