Original article from Kent Live
Millions of people will be able to claim hundreds of pounds back ahead of the new tax year, but time is running out.
Those who have been saving, preparing for retirement, or have had to work from home in the last year are among those eligible to claim money before Tuesday (April 6), reports the Mirror.
The last-minute HMRC refunds also extend to those who are required to wear a uniform to work.
If you have to wear a specific item of clothing due to your employer, you could get a uniform rebate.
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For more ways to get a quick buck before the end of the tax year, read on.
1. Claim £125 work from home relief
It's not every day that the tax man dishes out cash, so if you've worked from home for even just one day in the past year due to COVID, make sure you claim your work from home relief as soon as possible.
The deadline to claim the rebate is midnight on April 5 – and those who do so could get up to £125 back.
The 'work from home' rebate applies even if you've only worked one day from home – and it's easy to claim online.
The money can be used to cover broadband and heating costs and other expenses incurred from working from home. You don't need to submit receipts to make a claim.
Once verified, it will automatically be returned in your next pay slip with your tax code adjusted accordingly.
The rebate is paid based on the rate at which you pay tax.
For example, a worker that pays the 20 per cent basic rate of tax and claims tax relief on £6 a week, would receive £1.20 a week in tax relief (20 per cent of £6 a week) towards the cost of their household bills.
You can claim £2.40 a week if you pay the higher 40 per cent tax rate.
Over the course of a year, this means workers could reduce the tax they pay by £62.40 or £124.80.
If you miss the deadline, you won't be locked out completely. HMRC told The Mirror you will have to claim it separately and will receive a lump sum payment instead.
2. Use up your Isa allowance
The 2020-21 tax year Isa allowance is £20,000 – and as usual, all returns are tax-free.
However, before you move your money or open an account, check that an Isa is the best savings type for you.
That's because Isas are in addition to the Personal Savings Allowance (PSA) which came into effect on April 6, 2016.
If you're a basic rate taxpayer you can earn up to £1,000 in savings income tax-free. For higher rate taxpayers, this is £500.
In short, this means you can choose a non-Isa savings account and still benefit.
For example, if your current account provider has a savings account with a high rate, you might find it more convenient to pop your cash in there instead. Either way, it'll be tax-free.
If you're opting for an Isa, you'll need to move your money before April 5 to take advantage of the full tax-free year.
3. Make use of the marriage allowance
Millions of couples may be eligible for a £250 tax break thanks to a little known law that lets you share your allowance with your partner.
It's known as the Marriage Allowance and allows anyone with an income of £12,500 or less to transfer up to £1,250 of their Personal Allowance to their husband, wife or civil partner – if their income is higher.
This reduces their tax by up to £250 for the 2020 to 2021 tax year. Claims can also be backdated four years to April 2016. After April 5, 2021, couples will only be able to claim back to the 2017 to 2018 year.
If a claim is backdated, the couple could receive up to £1,150 back.
4. Top up your Lifetime Isa
The Lifetime Isa is one of the best savings options out there because it offers free cash from the government to put towards your first home or retirement.
Through it, you can get up to £1,000 a year in the form of a government bonus up until the age of 50.
If you opened a Lifetime Isa at age 18, that is a maximum government bonus of £33,000 (or £32,000 if you're unlucky enough to have your birthday on April 6).
The Lifetime Isa can be opened by those aged 18 up to the day before their 40th birthday, and you can save up to £4,000 each year – either in one or more lump sums or as a regular monthly saving.
You can withdraw Lifetime Isa money once you've reached age 60 or earlier to buy your first property, but any other withdrawals will involve a penalty – currently 20 per cent.
The deadline to contribute for this tax year is April 5, 2021. On this day, the withdrawal penalty will also rise back up to 25 per cent.
5. Check your child benefit entitlement
The high income child benefit charge (HICBC) leaves thousands of parents with a tax-bill every single year in the UK, but a little planning ahead could get on top of it.
All parents are entitled to child benefit, but as soon as one of them earns more than £50,000, the amount starts to fall. This is then completely withdrawn when they hit the £60,000 salary threshold.
You can of course withdraw from the payments completely to avoid filling in a tax-return each year, but remember to do so via HMRC as otherwise it could affect your state pension credits.
If you're earning just slightly over the threshold, there is one way around it – and that's by increasing your pension contributions.
HICBC is based on your salary after any pension deductions. This means if you contribute enough to your pension to get your salary back to £49,999 then you'll get the full child benefit again.
Another option is to make charitable donations from the income over the £50,000 limit, which you’ll need to declare to HMRC on your tax return.
Don't forget child benefit payments are also rising next month.
6. Claim back cash for work uniform
Millions of hospital workers, shop staff and hairdressers are unaware they could get their expenses back from HMRC if they've had to pay for uniform in the past tax year.
It's simple to claim and the average payout is around £60.
You can find out exactly how much you are owed by following the steps on this online tool – each claim takes around three weeks.
Who can claim it?
You might be able to claim tax relief if:
You use your own money for things that you must buy for your job
You only use these things for your work
What can I claim it on?
Repairing or replacing small tools needed to do their job (for example, scissors or an electric drill)
Cleaning, repairing or replacing specialist clothing (for example, a branded uniform or safety boots)
Business mileage (not commuting)
Travel and overnight expenses
Professional fees and subscriptions
7. Boost your pension contributions
As with your Isa, it may be worthwhile considering topping up your pension to increase your savings for retirement where you can afford it.
When saving in a pension you receive income tax relief, depending on your personal circumstances.
The annual allowance for 2020/21 for pension contributions is £40,000. It's also worth noting that you can bring forward unused allowances from previous three tax years, as long as you were a member of the pension scheme within those years.
If you've been automatically enrolled into a workplace pension, the window is about to open for any changes to your contributions.
You and your employer must pay a percentage of your earnings into your workplace pension scheme. These minimums are currently 5% from you and 3% from your employer. If you can afford to increase your payments, now is the time to do so.