When can you claim clothing as a business expense?
Posted on 21st April 2022
As we have mentioned before when talking about expenses, to be considered a valid business expense the cost must meet the “wholly and exclusively” test. HMRC state that any costs claimed by the business must be “wholly and exclusively” for the purpose of the business. Crucially, this means that there can’t be any personal or private use (as with any rule, there are exceptions), but clothing isn’t one of them!
Ultimately, HMRC argue that we must all wear clothing (some may argue not!), so they are clear that anything in our “everyday wardrobe” cannot be claimed. This means that even if you have a lucky pair of pants that help you secure that sales deal, or big girl knickers that make you feel more empowered ready for that busy day – you can’t claim the cost of them as a business expense.
So what clothing can be claimed?
If you need Personal Protective Equipment – very topical over the past few years due to Covid – then this can be claimed. This would include goggles, masks, gloves, overalls, and aprons.
Similarly, any other industry-specific protective clothing can be claimed. This may include steel-toe-capped boots, hi-vis jackets, flame-retardant clothing etc.
HMRC acknowledges that this clothing is necessary to perform your job, so you can go ahead and safely claim these costs.
Similarly to protective clothing, HMRC accept that uniform is required for some roles. The cost of uniforms purchased for directors and staff can be claimed in full.
Here we aren’t talking about brands such as Nike, Levi or Gucci – we are talking about promoting YOUR brand!
So, you can claim the cost of any clothing showcasing your company name or logo. This must be a permanent feature of the clothing though – not a pin badge!
Performers, actors, actresses and entertainers can claim the cost of any costumes needed for their roles. This is the case even if they COULD be worn again outside of the performance.
HMRC will also allow performers to claim the cost of clothing to attend a film premiere.
What can't you claim?
In short - you can't claim anything else.
Despite many arguing the case with me over the years (I have been doing this a long time), unfortunately HMRC will not accept general office wear (suits, shirts, blouses, trousers, skirts, ties, jackets) to be valid business expenses. They argue that they CAN be used outside of business – even if you CHOOSE not to – so can form part of your “everyday wardrobe”.
If you are a client and are ever unsure on what you can and can’t claim – please get in touch with your Client Manager and they will be happy to help.
Nicola J Sorrell - Effective Accounting
Founder | Xero Champion | IR35 Expert
Tagged as: Expenses, FAQ, For - Contractors, For - Employers, For - Limited Companies, For - Self-Employed
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