How much tax you owe can also change according to the NICs or Student Loan payments you’re making, or if you’re earning any money overseas.
The other things you need to know about are your tax code and Personal Allowance. Your tax code is a string of numbers and letters that HMRC uses to work out your tax calculations. Tax codes cover your Personal Allowance and any special circumstances affecting your tax situation. It’s really important the make sure your tax code is correct – which is why RIFT will always check it for you and get it fixed if it’s wrong.
If you’re making any “salary sacrifices” in order to get benefits from your boss, the tax you owe can be affected. The same goes for any contributions you’ve made to a pension plan. It’s always worth double-checking on details like these, so RIFT takes special care with them.
This brings us to the main reason why people end up being owed an HMRC tax rebate. While the taxman generally does a good job of calculating what you owe, he can only work with the information he has to hand. The tax rules say you can get tax relief when you’re shelling out from your own pocket for many of the essentials of your work. However, HMRC isn’t a mind reader and won’t know what you’re spending unless you tell it. If you’re paying for things like travel to temporary workplaces (where you work for less than 24 months), for instance, you need to make a tax rebate claim to get your money back. That’s exactly what RIFT is here to help with, and our tax rebate calculator’s the perfect way to start.
Self-Employment and The Construction Industry Scheme
Self-employed people generally don’t pay their tax through the PAYE system. Instead, they submit yearly Self Assessment tax returns to report their earnings and expenses to HMRC. The Self Assessment rules allow you to count many essential expenses against the profits you’re being taxed on, bringing your tax bill down.
However, there’s a special system for the building trade called the Construction Industry Scheme (CIS). Under CIS, your contractor has to hack off a whopping 20% chunk of your pay before handing the rest over. That missing chunk goes straight to the taxman. This can be a real pain for many construction workers, who end up not getting the full benefit of their tax-free Personal Allowances. Don’t worry, though, with RIFT’s help you’ll never find yourself losing out to HMRC.
Another thing self-employed people need to look out for is the NICs they’re being charged. The National Insurance rules are different when you work for yourself – but again, RIFT will make sure you never get tripped up.
Work mileage and tax rebates
Travel to temporary worksites is one of the main reasons why people end up being owed tax rebates each year. Our quick and simple mileage tax calculator will give you an instant estimate* of how much you can claim back from HMRC for your work travel.
The basic system works like this: HMRC has decided on a set of Approved Mileage Allowance Payment (AMAP) rates for essential work travel. If you’re footing the bill for public transport or travel in your own vehicle to a temporary workplace, the taxman says you can be reimbursed up to the appropriate AMAP rate. If you’re getting nothing toward your travel from your employer, or getting less than the AMAP rate you qualify for, you can claim back the difference as a tax rebate.