Different Types of Tax Rebates

Tax rebates, or tax refunds, are very common, and they essentially involve getting money back from HMRC when you pay more tax than you should. It’s never a great idea to pay more tax than you need to, so it is well worth knowing about the situations where you may be able to claim back some cash.

Whether you are an employee, freelancer or a small business owner, here’s a guide to the main types of tax rebates.

PAYE Tax Rebates

If you are an employee and you pay tax via the PAYE system, sometimes you might pay too much, and this is one of the most common types of tax rebates.

This may be due to being given a PAYE code that is not correct, like the emergency tax code. You might be put on this when you start a new job.

So what should you do if you pay too much? If you overpay your tax and you are due a tax rebate, you will receive a letter from HMRC called a P800. These are sent after the end of the tax year, and they usually arrive in September.

You can then claim the tax online using the Gov.uk site, and the money is then sent directly to your bank account in a few days. Or you can opt to receive a cheque, but this takes longer. You can also inform HMRC if you think you have paid too much tax.

Vehicle Rebate

If you use your car for work, you can often claim a tax refund. As part of our tax advice service, we provide details about where you can make savings, and vehicles are often an important area.

For example, you might be able to claim back money when you use a vehicle to visit clients or travel to other offices. This does not, however, cover trips from your home to your permanent place of work, and it only applies to business travel.

Uniform Rebate

If you wear a uniform as part of your job, or protective clothing of some kind, you might have to spend money looking after it and keeping it clean, or even buying a new uniform.

Police officers, healthcare workers and firefighters all have uniforms they have to care for, but it could also apply to anything as simple as a t-shirt with the company logo on it.

If so, you might be able to claim some money back as a result so you don’t spend more than you should be caring for your uniform that is an essential part of your job.

Equipment Rebate

Just as you might have to look after your uniform, you might also need to use equipment as part of your job when it is not covered by your employer. This might include buying your own tools and maintaining them. This could apply to contractors in the construction industry as well as mechanics where the CIS scheme might apply.

Don’t Overpay Your Tax

These are some of the most common types of tax rebates that you might face, and it’s a good idea to be familiar with them so you can look at ways to claim back any tax that you have overpaid.

Whether these apply to you or not, paying too much tax is never a good idea. Whether you are an individual, freelancer, contractor or you run a small business, we can help to minimise your tax burden with our tax planning and tax advice services. That way, you can ensure you are only paying what you should be and nothing more.