The HM Revenue and Customs (HMRC) has detailed the potential risks of not checking eligibility
HM Revenue and Customs (HMRC) has fired off a fierce warning for remote workers, flagging that a hefty number might be chucking thousands down the drain if they don’t check their eligibility before lodging a work expense claim. The tax authority has flagged up the risk of employees getting snared by agencies pledging speedy cash back on work expenses in return for a slice of the refund.
Yet, without checking if they’re genuinely entitled to these work expenses first, they could get saddled with repaying the whole lot, which might sting them with a bill of thousands. In a cautionary note on social media, HMRC wrote: “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.”
To add weight to its campaign ‘Don’t Get Caught Out’, it told a hypothetical story about a man named Mike as an example, lifted straight from the pages of real horror stories. Mike had been swayed to make a claim through a refund firm that led him to believe he’d claw back £4,000 for work-related costs from HMRC.
The firm pocketed a cool £1,600 for their trouble, leaving Mike with the rest. Fast forward a year and HMRC’ contacts Mike, telling him he wasn’t entitled to the expenses and now owes the full £4,000 plus any interest that’s been piling up.
Tax refunds can be claimed for a range of items, including tools, travel expenses and work uniforms. It’s free and relatively quick to check your eligibility for a tax refund, something you should always do even if you decide to use an agent or a tax refund company.
You might also need to provide HMRC with evidence of your eligibility to make the claim, such as receipts for expenses, so make sure you have these ready before submitting a claim. A quick check can be done via GOV.UK here.
It’s important to remember when looking at 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.