Tax relief to buy tools etc

[Pauly.22]

Hi,

basically i started work as an apprentice in june, my firm supply testers and will pay half towards electric drills etc.

but the main tools screwdrivers, snipps, etc i need to buy myself and if i leave then i take them with me.

I have been told that i can get a tax relief, in order to buy tools etc that i need.

i've looked on the HMRC website but i'm not 100% sure on what to do.

do i need to buy what i want and then send the receipts to them, and they wil then not tax me that amount for the next couple of months?

if anyone has done this, and has any advice on where to buy and what makes are best, i know knipex are good but a bit expensive.

thanks

Paul.

 

[Geoffsd]

Yes, you will get tax relief on everything you have to buy yourself in order to do your job.

Bear in mind you only get 20p (or whatever it may be now) for every £1 you spend.

If you're on PAYE call the tax office and ask how to claim (they are quite helpful) or maybe your wages department will know.

 

[Knobhead]

As Geoff has said give the tax office a call. Remember to keep all you receipts. 20% back better than nothing. If you need a laptop for doing reports, get that slapped in. You may get turned down, but it’s worth a try.

Some high-end items such as test sets or computers get 25% depreciation, but this is only if you’re self employed.

Now say you spend £1000 on a tester:
Year 1 claim £250-00 book value becomes £750-00
Year 2 claim £187-50 book value becomes £562-50
Year 3 claim £140-63 book value becomes £421-88
Year 4 claim £105-47 book value becomes £316-41
And so on until after 20 years it’s book value is a princely £3-17
If at any time you sell the tester any difference between the book price is a + or – in your year-end depreciation claim. Or you just write it off and claim it’s full book value.

Now say you spend £1000 on a computer. Computers and cameras are a special case, 4 years depreciation:
Year 1 claim £250 book value becomes £750
Year 2 claim £250 book value becomes £500
Year 3 claim £250 book value becomes £250
Year 4 claim £250 book value becomes £0
At that point you can flog it and what ever you make on it doesn’t have to be declared. As far as the tax office is concerned it’s junk.

I ran a photography business for over ten years, I used to look forward to sending the returns in. the rebate was the holiday spending money! I made a bog up of it 1 year and had to pay £3-75 tax, bugger! My wife was a tax inspector and she watched me like a hawk. No dodgy claims, her job was on the line if I got caught.

 

[Deleted member 26818]

Tony, I believe the only claiming 25% per year has now gone out the window for items below £50,000.

 

[Amp David]

His calc are old school, thats why

 

[bomjac]

Pauly,

Make sure that you contact the tax office to claim your allowance for tools and work clothing. There is an allowance that you can get added to your tax code to offset this. Keep all your receipts as if you go over this value in a tax year then you will be able to claim over and above the value (£185 a year to your tax code is the last I remember, backdate-able to 7 years if you have never claimed it till now for the established tradesmen !).

Also, make enquiries as to whether you or your parents house insurance will cover you for theft of tools from site. Very costly to replace them all if some thieving bugger takes a shine to your kit.

 

[Freedomaccounts]

Things such as tools & consumables will reduce your net profit....in turn this reduces the amount of tax & NI you pay to HMRC or increase any refund due.

Items of equipment you can claim up to 100% of the first £50k in a tax year as what's capital allowances. These are the tax office version of depreciation.

Your accountant should be able to advise on this and any other items you offset....if you're not claiming enough they should also let you know!

 

[bomjac]

Think some of you guys have gone off on a tangent here. The OP has stated that he started off as an apprentice, so it will be a few years before he has to worry about self-employed status.