Mechanics Tax Rebate Calculator

As a mechanic, the chances are that you spend quite a bit of your own money on tools for your job. You need them, so you buy them. It’s an expected part of working life for auto technicians and mechanics. It’s also quite rare that an employer reimburses you for these costs.

To help mechanics cover the cost the tax office has a range of tax reliefs and allowances which need to be reclaimed otherwise you will miss out.

As a mechanic, you are entitled to tax relief on your tool purchases and this includes any toolboxes and software agreements.

You don’t need to wait until any credit agreements are paid off to claim with the tax office accepting ownership from the date your agreement was signed.

This isn’t just for self employed mechanics. You are entitled to the same tax relief on your tool expenses as an employed mechanic under PAYE.

Why use the Mechanics Tax Rebate Calculator?

Our Mechanics Tax Rebate Calculator is completely free. It doesn’t cost you money, or collect any of your data. You only enter one figure to get your potential Tools Tax Rebate amount, without any identifying details.

The Mechanics Tax Rebate Calculator gives you an estimated figure of how much tax relief you can claim on the tools you purchased for work. You only need one number to use the calculator, and it’s absolutely fine if it’s just the rough total.

Although the more precise the figure you enter, the more accurate the calculator can be. You can include all tools and tool boxes, even those you’re paying for on a finance agreement.

It can only be an approximation because there are several other factors that influence your tax rebate position, like how much tax you have paid. We can also include several other tax reliefs and allowances that you are entitled to within one claim, which will increase your final refund.

What calculation is being made?

The Mechanics Tax Rebate Calculator works out 18% of your total tools spend. This is because you are making a Capital Allowances claim, and this is the current rate of relief.

For example, if you spent £6,000 on tools for work in the last tax year, you can potentially claim £1,080 in mechanics tax relief.

Of course, it is not entirely as simple as this one equation. You have to meet the full eligibility criteria and take the entirety of your tax position into consideration.

Important: If you are including tool receipts from outside the previous four tax years, tax relief is still applicable as long as the item(s) are still in use. The same sum of tax is refunded for these purchases but the refund is spread over a number of years due to the capital allowances legislation.

What are the eligibility criteria to claim for a mechanics tax rebate?

Here is our basic checklist of eligibility criteria for claiming a mechanics tools tax rebate:

• You must have paid income tax during the tax year you are making a tools tax rebate claim for.
• You paid the total cost of the tools and equipment yourself, without a total reimbursement from your employer.
• The tools are essential to your work.

If your boss only paid you a percentage of the total as a reimbursement, we can sometimes secure tax relief on the remaining portion you paid yourself.

What other tax relief can I claim as a mechanic?

This is where we find lots of mechanics and auto technicians are really missing out, simply because they don’t have the tax regulation knowledge. You need to look at your position and match the relevant tax reliefs and allowances. But if you don’t know they’re there, you can’t claim for them.

For example, you can get tax relief on:

• Your IMI and Trade Union membership fees.
• You can also make a claim for washing your protective clothing.
• And on the interest payments from your finance agreements.
• We’ve even discovered that some mechanics are eligible to claim for mileage and subsistence.

It is all totally dependent on your individual circumstances. That’s why hiring a tax professional is the most cost effective way to make yourself tax efficient.

Do I need a lot of paperwork?

No, you just need proof of purchase for the tools you are claiming tax relief for. That means receipts or activity reports from your tool provider. Many of whom are obliging enough to re-send your copy, if you’ve already filed it in the bin. You can also use online statements from shops like Ebay and Amazon.

Keeping copies of your credit agreements is also recommended so tax relief can be claimed back on the interest part of your payments.

Other types of tax rebate mentioned, have different evidence requirements. It is important to gather all the evidence together before submitting any kind of claim to HMRC.

How do I make a claim for a mechanic tax rebate?

To make a mechanic tax rebate claim you will need to either complete a form P87 or a self assessment tax return (or both).

If the value of your claim is below £2500 in any one tax year you should complete your claim through the completion of a P87 online or by post if you prefer.

A claim worth £2500 or more in any one tax year will normally have to be submitted through the submission of a self assessment tax return.