Julie Butler reports on a recent case involving a tax relief claim for work clothes. 

Introduction

There is a long running debate – should clothes worn at work be allowed against a tax bill? The recent case of Sian Williams and the tax tribunal highlighted this point. There are a number of angles here. The employed question versus the self-employed, required versus Health & Safety and exactly what is "exclusively"?

Claiming Clothing Costs when Employed

The employed have to pass the HMRC test of “wholly, exclusively and necessarily in the performance of employment duties.” It is important to look at the key word “exclusively”. Sian claimed that because clothing was required by BBC bosses who asked for regular wardrobe rotation, the clothes were required for the employment. The clothing such as that worn by Sian can equally be used outside of the place of work and therefore did not qualify for tax relief.

There were many who were surprised that, because the HMRC rules are so clear the case was taken to Tribunal.  There are many who are not surprised by the outcome – there would be an opening of “floodgates” for the claim of “city suits” by the employed.

Claiming Clothing Costs for the Self-Employed

The HMRC legislation for the self-employed does not include the word “exclusively”. There is also the concept of “duality” to consider.

Health & Safety

The employer must provide his staff with correct and compliant health & safety clothes and equipment.  When clothes fall into the category of being needed for health & safety compliance there is a distinct difference. The key for the self-employed is where there is a health & safety element there has to be tax allowability. Record keeping will be of great importance.

Sian Williams suggested to the Tribunal that HMRC had permitted other presenters to submit claims for clothing as tax-deductible expenses and also suggested that her job was like that of an actor. Her legal team told the Tribunal:

“If the appellant wore the same clothes frequently when appearing on television she would lose her job. The appellant would be prepared to wear no clothing when performing her job but is required to do so by her employer.”

The Tribunal, which sat in Manchester in January 2010, rejected her claims that the clothes and haircuts were exclusively for work. It said:

“It is argued on behalf of the appellant that she does not need clothes for warmth as it is warm inside the studios, and that she would be prepared to read the news without clothes and only wears the clothes because her employer requires it…the Tribunal does not accept as realistic that she could perform her duties without wearing any clothes at all.” 

Apparently Sian Williams came to prominence as a presenter on BBC News 24, a job that she secured after standing in, while working as a producer, for a screen test wearing a man’s jacket and without make up. There could be many who would argue that presenting the news in “the buff” was not a bluff.

Perhaps some naked news presentation would emphasise the high cost of non-tax-allowable work clothing. The issues are clearly the difference between employed and self-employed and protective clothing compared to decorative clothing.

Article Added Sunday, 16 May 2010 | 1589 Hits

Your attention is drawn to the disclaimer on this site, which applies to the content in this section.