Carousel_Arrow Chat IHT_trust_wills IR35 Login Mobile Menu Share Share Email SubMenuMobile VAT View_Gallery View_List capital_allow Triangle 2 Copy Close construction cyberpro employment_tax_shares emplyer_solutions entrepreneurs_corps fee_protect Go grant_fund Group i_Clock i_Consult i_Done i_Eligibility_Tick i_Enter i_Filter i_HMRC i_Negative i_Play i_Plus i_Reset i_Support_Legal i_Support_TaxDesk i_Support_VAT i_Tick noun_marketing_1872083 noun_online_2126759 i_download i_meet Group Copy 24 Group 18 noun_electrical_1240755 copy noun_Technology_2125422 noun_Science_2031115 i_tick_bullet_block international_tax patent_box private_client property_sdlt r_and_d reliefs_incentives Search specialist_tax status tax_indemnity valuation
icon_cookie Created with Sketch. Cookies

We use cookies on this website. You can choose to accept them all or to opt out of some. You can change your consent at any time by opening this window again

This includes all necessary technical and session cookies, plus performance, tracking and persistent cookies.

If you choose this option, we will block all performance, targeting and persistent cookies. Many parts of this site will then not work.

Please read the full details in our Cookie Statement.
Markel Tax

13 Mar 2018

Taxation of self-funded work-related training

Currently employees and self-employed individuals have access to relief against the costs of “work related training”.

This is defined as training for an employee’s current employment or a related employment or a self-employed person maintaining or updating existing skills (but not acquiring new skill sets which is covered via capital allowances). This also includes a tax exemption for costs met by an employer for an employee who is about to leave, or who left less than 12 months ago, to attend certain courses of retraining intended to help them get another job or set up a business.

Where an employee’s costs are not reimbursed there is currently no scope for tax relief (with limited exemptions) because they are not incurred in the performance of the duties of the employment

HMRC statistics show that over 1.8M individuals self-funded work related training in 2016. The vast majority of these individuals were unable to deduct those costs from their income or have it provided tax free by employers. There is strong evidence that the cost of training is a significant barrier to learning especially for those who could most benefit from it. The Government wishes to extend the available tax and NIC reliefs available to make training more attractive and less costly as part of its wider strategy of enhancing work opportunities and maximising earning potential.

Objectives of the consultation
  • Support those needing to retrain or upskill or who need or want to change career
  • Support those undertaking training with approved providers and leading to qualifications
  • Limiting the scope for misuse of the relief
  • Be sustainable and affordable to the public finances
  • Be simple to understand and administer

The consultation closes on 8 June 2018 and the consultation document may be found at:

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/689227/PU2152__Consultation_on_self-funded_training_web.pdf

The consultation raises 14 questions covering the underlying issues, the validity of the stated objectives and compliance risks. The underlying concept is an important plank in the upskilling of the UK’s workforce and this is an early opportunity to make your voice heard in the design of a new system of tax and NIC reliefs.
Tagged Spring Statement
Next article in series

13 Mar 2018

Tackling the Plastic Problem

The Prime Minister launched a 25 year Environment Plan in January 2018 including a pledge to eradicate all avoidable plastic waste by 2042.

Receive your regular Markel round-up

Sign up to our monthly newsletter

Strategic partners

  • Tolleys
  • Institute of Financial Accountants
  • BTC Software
  • AccountingCPD.net
  • Lovell Consulting