Are you able to claim for work clothing or business clothes as a genuine business expense? Well, whether you are a sole trader or you are running your own company, you will almost certainly buy clothes to wear for work. This could be a suit, work trousers, smart formal clothing, overalls or protective clothing etc. Therefore, when are you able to claim for these as part of your business expenses? This is a grey area and we look here at when clothing is tax-deductible.
As a contractor, you may be able to claim for work clothes and please read on to see if you can do. Please note, in many instances, there are two expenses that are often missed by contractors and small business owners alike. These are Trivial Benefits and the Annual Event (Christmas Party). There are also certain rules to follow if you plan to make company donations or give business gifts.
Is the work clothing part of an everyday wardrobe
When you consider if you can claim for work clothes, we need to think about everyday clothing. HM Revenue & Customs (HMRC) take their basic rule from the case of a lady barrister. She tried to claim for tax relief on the dark suits that she bought to wear for court appearances. HMRC did not let her claim the tax relief. This is because she could have worn those suits on occasions that did not relate to her work. In addition, a further reason was because the rules say that clothing, by definition, has a `dual-purpose.’
Therefore, any clothing that is, or could be, part of an “everyday wardrobe,” is not tax-deductible.
The next four points are some clothing that HMRC say are specifically allowable.
Are the business clothes part of a work uniform
As part of your role, if your employer or client requires you to wear a uniform, the cost of this will be tax-deductible. Furthermore, when you wear a work uniform, it clearly shows what you do. In this case, you can claim clothing as a business expense, and you will receive tax relief.
An example of a work uniform is that of a uniform for a self-employed nurse.
You cannot, however, claim tax relief on any clothing other than your uniforms, such as shoes or undergarments.
In addition, please note that when you are working for yourself, there can also be uniform benefits. If your customers recognise you in your work uniform, this may help to generate further sales for your business in the future.
Forms of protective clothing
If you need to wear specialised clothing such as protective types of clothing as part of your day-to-day work, you are allowed to claim for the cost of this as well as personal protective equipment as part of your claim for work clothes. For example, if you are a self-employed builder and you buy a helmet and protective footwear to wear while working on site.
You cannot claim for other clothing such as trousers and a shirt as those will be part of your everyday wardrobe. It is only the workwear protective clothing itself that you can claim as expenses.
Work clothing / costumes for entertainers
If you are a musician, actor or another type of entertainer, you may buy clothes that are a costume. They could be “acquired for a stage, film or TV performance”. In this case, you can claim for tax relief on these.
Wearing an evening dress / outfit for work
When looking at if we can claim for business clothing, HMRC gives the example of a waiter. He has to wear evening dress, including a tailcoat for work. In this case, this is not part of an `everyday wardrobe,’ therefore he can claim this.
Please be careful in this area. The cost of buying or hiring evening dress for a business function such as an awards ceremony would not receive tax relief. This difference is because attending these functions is not necessary for you to do your job. Compare this to the waiter who is serving you, it is a key part of his job.
If your work clothing is tax deductible
After considering the above, if your clothes for work are tax deductible, you can also claim for repairing or replacing these, as and when the need arises.
When you are able to claim for your work clothing during the course of the tax year, you should obtain a receipt for these. Nowadays, many retailers will ask you for your email address. Once you give this to them, they will email the receipt to you, to save on paper.
Claiming tax relief for work clothing
If you own your own company and your work clothing is allowable under the above guidelines, you can claim these as an expense through your company. As a result, this will help save company tax.
Alternatively, if you are self-employed, you will claim for the clothes through your Self Assessment tax return. In turn, this will help lower your tax bill.
When we consider if we can claim for business clothing, this is another one of those grey areas. It is indeed not always clear what you can claim. Therefore, the above shows a good summary of what to bear in mind, when you consider if your work clothing is tax-deductible.
Please also have a read of the article covering tax tips for contractors.
Link to Contractor Advice UK group on