I’ve bought tools for my job but am now self employed. Can I claim tax relief?

Yes, even though you may now be self employed, you can still potentially claim tax relief for when you were employed under PAYE.

It is common for mechanics to purchase their own tools to be able to do their job; this is particularly relevant for those in the vehicle trade and construction industry. Both employed and self employed people may have to purchase tools for work, and both can claim tax relief.

Depending on whether you are self employed, for example a tradesman working under CIS, or are working for an employer, there are two very different ways of claiming tax relief for tools.

Is it too late to claim for everything I bought when I was employed under PAYE, before I went self employed?

No, it’s not too late to claim for items you bought during your employed work, as long as you have receipts. If you are employed, you have purchased tools for work use and you have not been reimbursed by your employer, you can generally claim tax relief on your tool purchases. This can be backdated for as many years as you have receipts/proof of purchase.

A tools tax rebate can be claimed by way of a capital allowance claim when you are employed under the PAYE system. This means any tool purchases you have proof of purchase for, that you bought when you were employed, can be claimed for in this way, up until the tax year you became self employed.

What do I do now I’m self employed?

When you become self employed all tax relief you wish to claim on tool purchases must be entered onto your Self Assessment tax return , in the expenses section. Any tax rebate due to you will be calculated by HMRC on submission of your tax return.