Army Tax Rebate

As a member of the Army, you are probably missing out on a tax rebate if you have to pay for your own travel.

Quite simply, we know that British armed forces personnel are the best in the world. We think that the least you deserve is the tax relief you are entitled to, with as little fuss as possible.

Army tax rebate eligibility

HMRC and the MoD finally sorted out the mass confusion around armed forces personnel being able to claim their full tax relief entitlement. You probably know this as DIN ‘2015DIN01-005’.

This notification states:

• You are allowed to claim tax relief on travel expenses, even if you receive HTD (home to duty) or GYH (get you home) payments.

There was a basic misunderstanding between the definitions of HMRC’s temporary workplace and the MoD’s temporary posting.

As this is a tax issue, it is HMRC’s regulation that takes precedence.

A ‘temporary workplace’ means somewhere that you work for 24 months or less, even if the MoD classes this as a permanent posting. HMRC’s rules apply to all taxpayers, including all of our armed forces personnel.

When am I eligible to claim a tax rebate on my travel expenses?

You are probably due a tax rebate on your travel expenses if:

• you are out of Phase 1 training
• you are posted for 24 months or less, in the UK or abroad
• you are on a training course lasting 24 months or less
• you use public transport, including ferries and planes
• you drive your own vehicle

If your posting is extended, you can still claim for the 24 months (or less) that was part of your initial assignment order.

Can I make a claim if I already get HTD payments?

The MoD pays you HTD at 21p per mile and you are not taxed on this amount. But HMRC’s mileage allowance to a ‘temporary workplace’ is 45p per mile up to 10,000 miles (and 25p thereafter), so you are fully entitled to reclaim the difference.

You still receive your tax free HTD payments; they just become part of the overall calculation for working out your tax rebate submission.

How much is an Army tax rebate worth?

Every case is dealt with on a case by case basis by HMRC, which is why we provide an individualised service and why it’s impossible to guarantee exactly what you might gain.

Several factors come into play, like your earnings, tax paid and the number of allowable business miles you have travelled in any one tax year.

You can use our free MoD tax rebate calculator to work out an estimate for your personal situation.

What evidence do I need to claim an Army tax rebate?

You usually need some evidence to support your tax relief claim. This might include:

• Monthly payslips. This shows which allowances are already included in your pay and how much tax you have paid.
• Assignment orders; detailing where, when and for how long you were at a ‘temporary workplace’. Remember, these are automatically deleted from the system after 60 days.
• Receipts for journeys done by public transport
• Financials, like P60s, P45s. You can get copies of yours through the Defence Gateway or give JPAC a quick call (0141 224 3600)
• Move and track documents

Excellent news, you can backdate an initial tax relief claim for the last 4 tax years. So even if you are now ex-forces, you can still make a claim for that time period.

How do I claim my Army tax rebate?

The way in which you claim a tax rebate as a member of the Army depends on the value of your claim.

• If your claim is valued at less than £2500 you should submit a P87 form to HMRC. You can complete the form online or post it to HMRC to the address on the form.
• For a claim with a value of £2500 or more a self assessment tax return will typically have to be submitted. If you complete a tax return already for a different reason you should include your claim in the relevant employment section of your return.