Medical professionals – claiming tax relief?

As an employee, you may incur certain expenses in the course of your work. If these aren’t reimbursed by your employer, you may be able to claim a deduction against your employment income and get tax relief for certain expenses.

The general rule is: expenses that are "wholly, exclusively and necessarily" incurred in the performance of your duties are typically eligible for tax relief. In contrast, expenses incurred to put you in a position to perform your duties but that aren't directly involved in its execution, are not.

Which expenses qualify for tax relief?

Specialist tools and clothing

Everyday clothing worn to work isn't eligible for tax deductions. However, HMRC offer flat rate expense allowances for various industries, covering tool upkeep and specialist work attire. This includes uniforms or branded clothing.

You can claim for maintaining tools and workwear but not their initial purchase.

HMRC's flat rate system simplifies claims but you should keep receipts if you’re claiming actual expenses. Healthcare workers can claim a standard £60 annually for specialist clothing upkeep.

Working from home

If your employer requires that you work from home, you might qualify for tax relief on additional household expenses. "Required" means that you’re living too far from your workplace to attend or if your employer doesn’t have an office. However, you can't claim if it's by choice or due to COVID-19, or if the office space is full. Eligible expenses include business calls or utility costs for your workspace. Not claimable are items used for both personal and business purposes, like rent or internet.

You can claim either £6 a week from 6 April, 2020 (previously £4), or the actual extra costs incurred, backed by evidence such as receipts.

Professional fees and subscriptions

You can claim tax relief on professional fees, if you must pay these to do your job, as well as annual subscriptions you pay to approved professional bodies or learned societies, if being a member of that body is relevant to your job, for example GMC, MPS, BMA & MDU. If the professional organisation isn’t on the approved HMRC list, you can’t claim tax relief.

Using your own vehicle for work

If you use your own vehicle for work, not including your usual commute between home and your workplace unless it’s a temporary place of work, you can claim tax relief on the approved mileage rate. This covers the cost of owning and running your vehicle. You can’t claim separately for things like fuel, electricity, vehicle tax, MOTs or repairs.

You’ll need to keep a record of dates and mileage of your work journeys.

Training and Continuing Professional Development (CPD)

As a member of a professional body, you may be required to undertake regular training or CPD to keep your knowledge and skills up to date. Although it’s required, in most cases, training costs incurred by an employee can’t be claimed for tax relief. This is because training or CPD isn’t incurred in the performance of your duties of employment; instead, it’s preparing you to carry out your duties.

However, if an employee is in the training phase of their career and failure to complete mandatory training and gain the qualification will mean that the employee won’t be able to continue in the role that would otherwise have been available to them after qualification, then they can obtain tax relief. Therefore, doctors on training contracts undertaking training and exams will be able to claim tax relief on the courses and exam costs. There’s a list of medical courses and exams, published by HMRC, that can be claimed, although it’s not exhaustive.

How to claim

You have four years to claim tax relief on expenses with HMRC. This can be submitted to HMRC via form P87 if under £2,500 per tax year, or if your total expenses per tax year exceeds £2.500, then you’ll have to prepare a self-assessment tax return.

To do this you’ll need to register with HMRC to let them know you want to complete a tax return. Once registration is completed, you’ll receive a letter from HMRC with your UTR number. This number is specific to you and is needed to complete your tax return.

Need help?

This information isn’t exhaustive. If you’d like to know more about how we can help you, please speak to your usual Larking Gowen contact or email us at enquiry@larking-gowen.co.uk.

Jamie Butcher