Are you overpaying tax?

As we near the end of another tax year, it’s not just self employed individuals who need to be considering their tax positions.

If you are an employee that has incurred certain expenses over the course of the last tax year, the end of the tax year provides you with an opportunity to reclaim some of the tax you have paid because of incurring these expenses.

Some of the more common expenses that can be claimed by employees are professional subscriptions, buying small tools that are required for them to do their job, buying and cleaning specialist work clothing, business mileage that is not reimbursed by their employer at HMRC official mileage rates, and a working from home allowance if you are required by your employer to carry out some of your work from your home.

HMRC also allow employees in certain industries to claim an annual ‘flat rate expense’, the amount of which varies depending on what type of work the employee does.

If you are a higher rate tax payer that makes regular gift aid payments, or makes payments into a personal pension scheme, you may be due higher rate tax relief on these payments also. If you are paying tax at higher rate, you have an opportunity prior to 5 April 2016 of paying into a personal pension, and obtain higher rate tax relief on this pension payment.

You are not just restricted to claiming tax relief for allowable expenses or pension/gift aid payments for the last tax year, either. It is possible to claim tax relief for tax years 2011/12 to date prior to 5 April 2016. If no action is taken prior to 5 April 2016, any tax relief due for the 2011/12 year will be lost.

If you would like further information on this, or require any assistance with your tax relief claims, please do not hesitate to contact Ross Campbell at the Dumfries office on 01387 955900 or ross.campbell@armstrongwatson.co.uk.