Tool tax relief for your employed joiners and labourers: £140, £60 or £120 a year, worked for six staff over five years

One of your joiners asks whether he can get tax back on the tools he bought himself. A labourer asks the same a week later. You are not the one who claims, but you will be asked, and the answer is a short table on GOV.UK.

What GOV.UK says

HMRC's Employment Income Manual sets out flat rate expenses "fixed by the Treasury for the tax years 2008 to 2009 onwards". For the building industry the yearly amounts are:

Other building trades sit in neighbouring entries: for example pipe fitters and plumbers are £120 under heating, and electrical workers are £120 (£60 if they only have laundry costs). Bricklayers and electricians are not named in the building entry, so look up the exact job title before telling anyone a figure.

The GOV.UK tax relief pages add the rules that matter:

• The relief is based on your tax rate: a £60 claim at 20% gives £12.
• A flat rate needs no receipts. The employee claims it as "Uniform, work clothing and tools".
• They can claim for the current tax year and the 4 previous tax years.
• Nothing can be claimed if the employer repays the cost in full. If you pay part of it, they can claim only the unpaid part.
• The relief cannot be more than the tax they paid that year.
• Anyone who files Self Assessment claims through the return instead.

The sum

Take six employees: two joiners, two labourers and two other building workers, all basic-rate taxpayers.

Per year: 2 x £28 = £56, 2 x £12 = £24 and 2 x £24 = £48, so £56 + £24 + £48 = £128. Check from the flat rates: £280 + £120 + £240 = £640, and £640 x 20% = £128. Over the current year and four previous years, five years at £128 is £640, assuming the same figures every year and enough tax paid each time. A single joiner would see £28 a year, or £140 over five. This is our arithmetic from the GOV.UK rates; a higher-rate taxpayer would get more, and I did not work that case.

It is small money per person, which is why it gets missed. It is also money the firm does not pay: it comes from HMRC, so it is not a cost to you.

What to put in place

• Do not double up. If the firm buys the tools or repays the receipts in full, there is nothing for the employee to claim. A tool allowance paid in the wage packet is a different matter and I did not read how it is taxed, so ask your payroll adviser.
• Tell staff where to claim. They claim themselves through their HMRC online account; the firm does not file it.
• Keep your own side tidy. Note who is on the payroll and what you reimburse, so a question from a joiner takes a minute. Self-employed subcontractors are a different case, covered in simplified expenses for a van and buying a van or tools as a sole trader.
• If you are taking on staff, see the first employee and employer National Insurance.

What I did not read

I did not read the full list of other trades, the figures for years before 2008 to 2009, the rules on professional subscriptions or laundry, or how a claim is coded by HMRC for the current year. The manual page did not explain how to claim, so the claim steps come from the GOV.UK tax relief pages. Check the current figures for the exact job title before you quote one.

Overlyft builds AI staff who join your trades team and keep the payroll list, flag which employees buy their own tools and prepare the short note for each of them, with the office manager approving what goes out.

This is general information, not tax or legal advice. Check the GOV.UK pages and HMRC's own guidance for your employee's case.