Guide to Expenses for Construction Workers
As a builder, whether you’re paid through PAYE or work under the Construction Industry Scheme (CIS), you may be surprised at what expenses you can claim back. There are, however, some differences to what you can claim depending on whether you’re a CIS or PAYE worker.
Self employed expenses – what can I claim?
Claiming Capital Expenses as a Builder
As a PAYE builder you are unfortunately unable to claim capital expenses. However, if you’re a builder working under CIS, you are able to claim capital expenses providing they are purchased for business use. For example, if you buy a laptop that you use exclusively for work or a car that you use only for work-related travel.
Claiming Motor Vehicle Costs as a Builder
As with capital expenses, as long as the vehicle you buy is used exclusively for business use, you will be able to claim the tax back on things such as fuel, insurance and road tax.
Claiming for Tools, Equipment and Uniform
If you work PAYE, you are able to claim expenses for any tools or equipment that you have paid for, if the same or similar item was not available from your employer. As a CIS worker, you are able to claim the purchase or replacement of tools as an expense.
You may also be able to claim back for wearing uniform or protective equipment as either a CIS or PAYE worker. For more information, see our uniform expenses guide.
Travel and Subsistence Expenses
As a CIS worker, you are able to claim back travel and subsistence expenses during your time at a temporary workplace. A workplace is considered temporary if your contract is below 24 months. If your contract length is uncertain, the workplace will be seen as a temporary workplace until you have been there for 24 months, it would then be considered permanent.
As a PAYE worker with one permanent place of work, you are unable to claim expenses on travel and subsistence. However, if you are required to temporarily work somewhere else (at another construction site, for example) you will be able to claim travel and subsistence expenses during your time there.
Builder Admin Costs
As a CIS worker, your ‘remaining admin costs’ are considered any expenses that aren’t incurred in any of the other categories but relate to your work. For example; phone, stationary or postage costs.
As a PAYE builder you are unlikely to incur any admin costs, and are therefore unable to claim expenses in this category.
General Business Expenses
As a CIS builder you are able to claim expenses back on things such as public liability insurance, union fees or working in a home office etc.
As a PAYE worker you are able to claim expenses back for trade union and subscription fees, as long as they relate to your specific job.
Self employed Mileage
Mileage can be claimed as an expense as long as the miles are incurred when travelling to a temporary place of work. As a CIS worker, this means that you are able to claim expenses on the miles you have driven for your contracts. As a PAYE worker, you are only able to claim mileage costs when travelling to a temporary place of work.
What expenses can I claim tax back on as a builder?
| Expense | Can I Claim as CIS? | Can I Claim as PAYE? |
|---|---|---|
| Capital Expenses Eg. new vehicles, PCs/hand held devices |
Yes - as long as they are purchased for business use | No |
| Motor Vehicle Costs Eg. road tax, car insurance, fuel |
Yes - as long as the costs are for a vehicle used for business use | No |
| Tools & Equipment Eg. purchased or hired tools, protective clothing, uniform laundering (for PAYE) |
Yes – however as a CIS worker, if you don’t have a standard uniform (and wear every day jeans/t-shirt etc to work) only compulsory protective wear can be expensed (eg. a high viz jacket) | Yes – if you have paid for the replacement of tools/equipment rather than your employer, and the same/similar item was not available to use from your employer, you can claim these expenses back |
| Travel and Subsistence Eg. Costs of travelling, eating and staying overnight at a temporary site |
Yes | Yes - if you are travelling to a temporary place of work |
| Remaining admin costs For CIS, this covers expenses incurred as part of your work not belonging in one of the previous categories eg: phone costs, stationary, postage |
Yes | No |
| General Business/Other Expenses Eg. Public liability insurance, home office, trade licence costs, union fees etc. |
Yes | Yes, for trade union and subscription fees relating to your specific job only |
| Mileage The number of miles you've driven for work |
Yes | Yes – if you are travelling to a temporary place of work |
How can Brian Alfred help?
We hope this guide has cleared up what you can and can’t claim as an expense. At Brian Alfred, its tax that makes us tick and our team are experts when it comes to maximising your tax rebate. You can also help us to help you by keeping a hold of your expense receipts throughout the year and sending copies of these to us along with your tax pack.
Get in touch with us today on 0208 570 1750 or download our tax pack now.