Employees eligible to claim a tax refund on work-related expenses are being urged to do it directly through HM Revenue and Customs to guarantee receiving 100% of their claim. Whether working in hospitality or retail, taking on a seasonal second job as a delivery driver, or even becoming Santa’s elf for the month, the most straightforward way to claim – and keep – all of a tax refund is through HMRC’s online service. A claim takes just 15 minutes. Employees can use the online service to check eligibility and get a full list of work expenses they could claim a tax refund for, including:

• cleaning, replacing or repairing a uniform or work clothing
• using their own vehicle for work including business mileage
• professional subscriptions they’ve paid for, that are needed to do their job

Suzanne Newton, HMRC’s Interim Director General for Transformation, said: “Christmas can be an expensive time of the year and for many, it could be a good opportunity to claim a tax refund on work expenses to boost finances. Latest figures show the average claim is £125 a year. But the only way to guarantee receiving 100% of your eligible refund is by claiming direct through HMRC. Just search ‘tax relief for expenses’ on GOV.UK to find out more.” Once customers have signed into the HMRC service, they just need to follow the simple step-by-step guidance to submit their claim. Those who need to set up an account can do so quickly and easily via GOV.UK. Customers considering using an agent to make their repayment claims are likely to be charged a fee – in some cases up to 50% of the value of the claim. If the claim is then found to be ineligible, customers are liable to pay back the full amount of the refund, not the amount they finally received, so could end up out of pocket. While going through an agent may seem like a simpler option at first, customers will need to supply the agent with the same information they would use to make the claim themselves using HMRC’s free online service. Anyone who does, nevertheless, choose to use an agent to make a claim on their behalf should also check the small print before signing a contract – including researching the company so they understand what commission is being charged and how much of their tax refund they are likely to receive back.

With Christmas just around the corner, new data from insolvency firm Begbies Traynor covering the first 10 weeks of Q4 2023 shows that thousands of UK retailers are in critical financial distress – including almost 1,000 online-only organisations. Nearly 4,500 businesses are now in critical financial distress as poor consumer confidence, sticky inflation, and elevated interest rates force consumers to hold back from spending big, even in the run up to Christmas. The decision by many consumers to remain very prudent on household expenditure during the most important shopping weeks of the year only adds to the pressures faced by this embattled sector, says the company. Julie Palmer, Partner at Begbies Traynor, said: “There is no doubt about it; the last 12 months have been incredibly difficult for British retailers as an increasingly tough economic backdrop continued to pile on the pressure, with businesses that were only just standing on two feet again now feeling the pain this Christmas. “And, after a year where consumers faced one of the worst cost-of-living squeezes on their wallets, the shopping bonanza many retailers were relying on this Christmas does not seem to have materialised, pushing many businesses close to financial ruin this winter. After the boom during the enforced lockdowns of the pandemic, the data also highlights the shift away from online only retailers as consumers return to bricks and mortar stores, favouring an omni-channel offer. In Q4, the number of online only businesses in critical financial distress leapt 11.7% to 910, representing over 20% of all the businesses in critical distress, while 7,393 online businesses were in significant distress, up 6.48% on the prior quarter. “What’s particularly interesting is the number of online only retailers now in critical financial distress. After the surge during the pandemic, it looks like the need to operate an omni-channel business model is more important than ever for retailers looking to succeed in this market. “Sadly, after the year they have just been through, many business owners will be looking ahead to 2024 with a degree of hope, but there’s nothing to suggest it’s going to be any easier next year. “After years of being addicted to cheap money, many of these businesses must now grapple with increased costs and another minimum wage hike in April, while converting their stock into cash to avoid quarterly rent day turning in to a fatal New Year hangover. “On top of that, the situation is deteriorating for many consumers as energy bills and interest rates remain stubbornly high. It is likely this situation will only get worse when over 1.5 million UK households roll off cheap fixed rate mortgage deals in 2024. “Ultimately, many of these businesses will have loaded up on debt during the good years and must now deal with the painful reality of higher interest rates at a time where demand is shrinking and margins are being eroded. So, plenty could fall victim to these pressures as the debt storm breaks across the country next year.”