Mechanics tax rebate flat rate expense

A flat rate expense is the annual amount of tax relief set by HMRC for specific work expenses that are common in particular professions. It is also known as a flat rate deduction and taxpayers do not usually have to provide supporting evidence for such claims.

How much is my Mechanics flat rate expenses worth?

Mechanics are eligible for a flat rate deduction of £120 per tax year, which is intended to cover the cost of tools and equipment that you have bought yourself.

A flat rate expense claim can be made for the last four tax years. Following a claim your tax code will be altered meaning you can earn an additional £120 a year tax free. After your initial flat rate expense claim, unless you start spending more than £120 on equipment, there is usually no need to make another claim for future years.

If a mechanic spends more on tools than the £120 a year that HMRC allows for in their flat rate deduction, then he or she can make a further or separate mechanics tool tax claim.

What if I spend more than £120 a year on my tools and equipment?

If you spend more than £120 per year on tools and equipment it is possible to claim a larger tax relief than would be provided via flat rate expenses. You can claim a tax refund on the actual amounts you spend through a Mechanics Capital Allowances claim.

To make a capital allowance claim you generally require proof of purchase for your tools. Acceptable proof of purchase can be in the form of receipts, credit agreements or activity reports from tool dealers such as Snap On, or Mac Tools.

A capital allowance tool tax rebate claim can potentially be made for as far back as a proof of purchase can be provided. Additional claims can be made at the end of each tax year.

Not all items are permissible when claiming mechanics tool tax relief  and you need to avoid potential fines by making sure that your claim is completely accurate.