HMRC has urged employees to check their eligibility before trying to claim tax back on work expenses, as failing to do so can result in a huge bill
HM Revenue and Customs (HMRC) has issued a stern warning to those who work from home. Many could be at risk of losing thousands of pounds if they fail to check their eligibility before making a work expense claim.
The government body cautioned that many employees could fall prey to agencies that claim that customers can receive money from work expenses in exchange for a percentage of the money. However, if an employee doesn’t verify their eligibility for work expenses beforehand, they could end up having to repay the entire amount, potentially resulting in a bill running into the thousands.
Writing on social media, HMRC said: “Don’t get caught out by ads promising quick tax refunds for working from home. Always check if you’re eligible before making a claim. Avoid agent fees by claiming directly with HMRC.”
As part of the government’s ‘Don’t Get Caught Out’ campaign, a hypothetical scenario was presented involving a worker named Mike. In this illustrative story, based on real-life experiences, Mike made a claim with a refund company that suggested he could reclaim £4,000 from HMRC in work-related expenses.
The company took £1,600 as a fee for its services, while Mike received the remainder. However, a year later, HMRC contacted him to inform him that he wasn’t eligible for the expenses and had to repay not only the full £4,000 but also any accrued interest.
Tax refunds can be claimed for a variety of things, including tools, travel costs, and work uniforms.
Checking your eligibility for a tax refund is free and fairly swift, something you should always do even if you opt to use an agent or a tax refund company. You may also need to furnish HMRC with proof of your eligibility to make the claim, like receipts for expenses, so ensure you have these handy before lodging a claim.
A quick check can be done via GOV.UK here.
All the things that cannot be claimed for work expenses
It’s vital to bear in mind when perusing adverts or agencies offering work-related refunds that there are several items that cannot be claimed as expenses.
For example:
- Food you bring from home when travelling to a temporary workplace
- Work from home costs when you have an office base but choose not to work there
- Union fees
- Work expenses already covered by your employer
- Workwear that doesn’t include a visible logo
- Uniform that has already been provided by an employer
- Work from home costs if your contact is part of a flexible working arrangement
- Travel and overnight expenses for commuting to your normal place of work
- Uniform washing costs when your employer has a laundry facility
If you think you’ve made an ineligible tax refund, you should contact HMRC as soon as possible as they can provide extra support to customers who need it.
