Claims for PAYE employment expenses not reimbursed by the employer now automatically face greater scrutiny by HMRC.
Each year, many employees claim tax relief for job-related expenses, such as subscriptions to professional bodies, business mileage, or travel and subsistence costs, and evidence of expenses must now be provided when a claim is made. This is part of a clampdown on ineligible expense claims, and the new approach sees HMRC checking and confirming eligibility before claims are progressed.
From 23 December 2024, there is a new online iForm to use both to claim and submit evidence. The online route comes after some months where claimants have had to download form P87 from gov.uk, and submit it postally. Whilst postal claims can still be made, HMRC expects that the online route will make life easier.
Claims for Flat Rate Expenses for uniform, work clothing and tools can be made online, and though not requiring evidence, will also face greater scrutiny.
Employees claiming expenses of more than £2,500 do so via self assessment. Though there is no change to the actual procedure involved for this, HMRC advises that it has begun compliance projects looking at claims submitted under self assessment, checking their eligibility and asking for further evidence.
Supporting evidence should therefore be carefully retained in all cases.
