Do I qualify for a tax rebate on tools if I’m not self employed?

Yes, you do qualify for a tax rebate on tools even if you’re not self employed.

The tax relief regulations are very specific about eligibility criteria. And the Capital Allowances rules are not exclusively for self employed taxpayers.

If you have bought tools for work that cost more than the FRE £120 allowance amount, then you can apply for Capital Allowances tax relief on your tool purchases. Remember, any tax relief claim that is not a Flat Rate Allowance need receipt evidence to back it up. You cannot claim for a tax rebate on your tools purchases for work, if you employer paid you back the money.

If the total amount you wish to submit is below £2,500 then you submit your claim in writing with the evidence to HMRC. But if you wish to submit a claim that is for items worth over £2,500, you will need to use the self assessment tax return procedure, even if you are paid through PAYE.

The process of claiming for tools if you are not self employed

After you have confirmed that you qualify a claim needs to be completed in writing with your tool receipts and or tool provider transaction history reports. For multiple tax year claims a capital allowance schedule should be completed to ensure you

If in any one tax year you have spent £2500 or more a self assessment tax return will usually have to be completed online. The self assessment system accounts for more variations of financial situation than simple payment by employer, including larger Capital Allowance tax relief claims.

This doesn’t mean that you are suddenly defined as self employed, it’s is merely the administration procedure you need to follow to receive your mechanic tools tax rebate.