Work in the Construction sector as a PAYE employee? Constantly driving to temporary sites? You could well be owed a sizable tax rebate from the taxman. Sound good? Let’s take a look at construction tax rebates, whether or not you’re owed one, and how to claim.

Construction industry tax rebates

If you’re on the books of a construction company, you’re likely clocking up the miles that count towards your yearly mileage refund. Plus, you’ll have daily expenses that count as construction industry tax deductions too, like meals and accommodation on the road.

You can claim the following back as part of your construction tax rebate:

  • Travel to different sites
  • Meals
  • Accommodation
  • Protective clothing or tools

Mileage tax relief

One of the biggest things you can claim money back for is your travel from site to site or from your home to temporary work sites.

HMRC has set out some Approved Mileage Allowance Payment (AMAP) rates, which are in place to help cover your travel expenses and the costs of running your vehicle.

Right now, they are:

  • 45p per mile for the first 10,000 miles by car/van, 25p per mile after that
  • 24p per mile by motorcycle
  • 20p per mile by bicycle

One thing to note is that to qualify for mileage allowance, you need to drive for work and not just to work. If you work at a permanent premises, like an office, and you simply drive to the same place every day, this is classed as driving to work and falls outside the scheme. But if you’re driving to temporary building sites, this counts as driving for work and means you can claim for your mileage allowance.

Your employer might already give you a mileage allowance. If this matches the rates from HMRC, you can’t claim back anything from the taxman. If you’re getting less than the AMAP rates from your employer, you can claim back the difference from HMRC.

How to make a construction tax rebate claim to HMRC

Aside from your mileage allowance, you can claim back other expenses including uniform, meals on the road, training and more.

To claim for a construction tax rebate for these expenses, you need to complete a specific form with HMRC – called a P87 form. Plus, you also need to show HMRC that you’re owed money.

HMRC will want to see:

  • A list of the sites you’ve worked on: You need to detail the places you’ve worked and the dates when you were there.
  • Monthly payslips: For each of the tax years your claim covers.
  • Supporting documents: Photo ID and proof of address is essential. As are receipts for work expenses and MOT certificates for any mileage claims.

You can also claim back for up to four years, so it really pays to have all your information in place.

If your claim is worth £2,500 or more in any tax year, you’ll also need to submit a self-assessment tax return to HMRC, which is double the documentation – you’ll probably need an expert like RIFT Refunds to help out with that.

Maximising construction tax rebates

It’s important to maximise your claim, so you can claim back as much as possible. Of course you want as much money as possible back in your pocket. The following will help:

Keep records

The taxman isn’t just going to cough up because you say he should. HMRC doesn’t like dishing out free money. They need to see evidence of your expenses for your journeys and extra costs. Receipts are essential, so keep records of everything you spend. They will form the backbone of a successful rebate.

Know what you can claim for

You can go back four years when you make a claim. If you claim on or after 6th April 2024, you can claim back for:

  • Year ended 5th April 2021
  • Year ended 5th April 2022
  • Year ended 5th April 2023
  • Year ended 5th April 2024

Just because you can claim back four years doesn’t mean you should wait for four years before you make your claim. It’s good practice to do it every year to make sure you don’t miss any deadlines. Plus, you’ll get money back in your pocket every year too.

Log everything

Log all your expenses, whether travel or food and uniform costs. A logbook is a good idea, or you can track everything quickly and easily with your MyRIFT account.

Get in touch with RIFT Refunds for construction tax rebates

If you’ve never done a construction tax rebate before, it can be daunting. Even the idea of speaking to HMRC or dealing with the taxman is scary for a lot of people. But think about the fact that this is money you’re owed from expenses you’ve already paid. You’re not cheating the system by claiming it back.

When dealing with HMRC it pays to have a specialist in your corner working on your behalf. RIFT was built to help the UK’s tradespeople community tackle the taxman. We have specialist construction teams who are on excellent terms with HMRC, construction bodies and unions to help you get the best out of your yearly tax refund claims. We also have reps travelling around the UK, clocking up thousands of miles each month to put cash in the back pocket of UK construction workers. You can meet them wherever suits you: on-site in the canteen, at your own home or even down the local pub. Find out who your rep is in your local area here.

Our mission is to keep everything smooth, simple and painless, with a specialised route calculation system to track your mileage and a free MyRIFT account to check details, upload receipts and track progress.

Get in touch with us today to find out more.