VW Taxation Ltd
Mechanic Tax Rebate
Tax Rebate Specialists for Mechanics
As a mechanic, when you down tools after a busy day at work the last thing you want to think about is managing your personal finances. It can be confusing, boring and time-consuming, especially when it comes to tax rebates. Wading through the jargon and the regulations set out by HMRC may feel like a chore – but you could be missing out on a well-earned mechanics tax rebate worth hundreds of pounds.
At VW Taxation, we are dedicated to helping mechanics receive what they are owed from HMRC, with the minimum of hassle.
Call us today for a no-obligation discussion about how to claim a tax rebate on tools and equipment, and take the first step towards receiving the tax refund you deserve.
What is a tax rebate and how does it work?
‘Tax relief’ is a reduction in the amount of income tax a worker is required to pay, to make up for expenses incurred due to work. This is received by way of a refund or ‘tax rebate’, paid directly to the individual.
It is important to remember that you will not receive a refund for the total sum of your expenses, rather you will receive tax relief on those expenses, based on the rate of income tax you pay.
Do I qualify for a mechanic tax rebate?
If you are required to purchase essential tools or protective clothing for your work as a mechanic at your own expense, which your employer does not reimburse you for in full, then you are entitled to claim tax relief. You must have paid income tax in the tax year for which you are making a claim.
How is a mechanics tax rebate calculated?
Tax relief is calculated based on the costs you have incurred and your income tax band, ie. if you pay a basic rate of income tax at 20%, you can claim back 20% of your expenses.
When can I apply for a mechanic tax rebate?
You can apply for a tools tax rebate at any time, backdated up to four years. HMRC will not prompt you to do so, you must apply for it under your own steam.
If you have overpaid tax as part of the PAYE scheme, HMRC will notify you by issuing a P800 form, usually around September. This will show the amount you have overpaid, which will be refunded automatically.
How do you claim a mechanics tax rebate?
In order to claim a tool tax rebate, you must apply for it by post or online. You will receive a reply from HMRC in anything up to 12 weeks and payment will be made in the following few weeks.
Before you apply, you must ensure that you have all the relevant paperwork and proof of purchases, such as receipts, activity schedules and finance agreements. It’s vital to do your homework as to exactly what you can and cannot claim for, or you will risk having your application refused by HMRC.
VW Taxation understands that the tax rebate process can be an annoying drain on your time and so we aim to make it as easy and stress-free as possible for our mechanic clients. We can take the task of form filling, compiling documentation and liaising with HMRC out of your hands, as well as offering sound advice on what you are entitled to claim.
What expenses can I claim a tax rebate on as a mechanic?
Mechanics are regularly required to purchase essential tools at their own expense. If those expenses are not refunded in full by your employer, then you may be able to claim tax relief on them.
Here is a summary of expenses that a mechanic may typically claim tax relief on:
If you have to clean your protective work uniform yourself, or if you have to replace or repair it at your own expense, then you are entitled to claim the tax back. This does not apply if your employer reimburses you for the cost, or if they provide laundry services. It also excludes the initial purchase of uniform, you can only claim tax relief on uniform that you replace. The flat-rate allowance for a mechanic’s uniform is currently £60. It may be that this allowance is already included in your tax code, but if not, it is up to you to apply for a rebate.
It is worth noting that PPE is not eligible for tax relief, as employers are required to supply the necessary protective equipment, or at least reimburse you for expenses incurred.
To claim a tool tax rebate, you must own the equipment, not lease it. The equipment must also be for professional use only, not personal use.
HMRC provides a flat-rate allowance to mechanics for tools up to £120 per year. That means, if you spend up to £120 on tools, you can claim 20% back (providing you are in the basic tax rate bracket paying 20% income tax). No proof of purchase is required and your claim can be backdated for up to four years.
If you buy tools worth more than £120 per year you can apply for a rebate as a Capital Allowance. To do so, you must provide every proof of purchase, such as receipts or a schedule from your supplier. The rate is set at 18% and there is no restriction on how far back you can claim, as long as the equipment is still in use. There are strict regulations on what type of tools and equipment qualify for Capital Allowance, as set out by HMRC, so it pays to seek the advice of a tax specialist such as VW Taxation.
If you have taken out a finance agreement to purchase tools and equipment, you are able to claim tax back on the interest paid. This can be backdated for up to four years.
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So, How Do I Claim a Rebate?
Why choose VW Taxation?
As a mechanic, you perform a highly-skilled and valuable service, and VW Taxation would be pleased to extend a helping hand to you in return. Just as you live and breathe mechanics, we live and breathe taxation, and we have all of the advice and answers you need about mechanics tax relief.
By choosing VW Taxation, you can be sure of a professional and friendly service. We pride ourselves on our transparent and honest approach, and you can be sure that we have your best interests at heart. We do not want you to lose a single penny that you are entitled to and we will work hard on your behalf to achieve the tax refund that you deserve.