What can teachers claim on their taxes?

Like most self-employed roles, teachers can experience varying levels of income. During months where you have less work coming in, you might find yourself struggling financially. Luckily, you can save a few of your hard-earned pennies by claiming some of your work-related expenses back on your taxes.

This guide will answer the following questions about claiming tax relief as a self-employed teacher: 

• Do I have to do a tax return as a self-employed teacher?
• What can I claim for?
• How much tax will I pay?
• How do I claim tax relief?
• How can Countingup help?

All self-employed people must declare their earnings to HMRC (HM Revenue and Customs) to calculate how much they owe in tax. You do this by filling in a Self Assessment tax return that outlines how much you made and spent during the tax year. 

A tax year ends on 5 April and you must register for Self Assessment online by 5 October to pay your tax bill for the tax year just ended. For example: 

Let’s say you’re a self-employed teacher in the 2021/22 tax year, which ends on 5 April 2022. In that case, you must register for Self Assessment online by 5 October 2022. Once you’re registered, you have to pay your tax bill by 31 January 2023.

However, every working person in the UK has an annual Personal Allowance of £12,570 that isn’t taxed. This means that you only have to pay tax on your earnings that are above that limit. 

While you can claim tax relief on a lot of expenses, HMRC has strict rules for when you’re allowed to make a claim. Generally, the rule is that the cost must relate ‘wholly, exclusively and necessarily’ to performing your duties. In other words, you cannot claim for expenses that in any way relate to personal use. 

If you’re a member of a professional body, like the National Education Union (NEU) or NASUWT Teachers Union, you can claim the subscription costs on your taxes. However, each professional organisation has to make its own arrangement with HMRC, meaning the amounts you can claim vary.

HMRC has an approved list of organisations that are eligible for tax relief. You might also be able to claim for your subscriptions to magazines and textbooks for school use. Additionally, any fees you paid to a general teaching council will also be eligible for tax relief, even if an organisation is no longer active.

As a self-employed teacher, you can also claim tax relief on any specialist clothing or equipment you’re contractually obligated to use. For PE teachers, this could be sportswear and hockey sticks or tennis rackets. Another example is science teachers who must wear protective clothing like lab coats and safety goggles.

The requirement is that you have to use this specialist clothing and equipment to carry out your duties and don’t wear them outside of work. In other words, you can’t claim for clothes that you’d wear for professional and personal purposes.

If you have to wash specialist clothing or a uniform with your employer’s logo on it, you can claim an allowance worth £60 per year.

While HMRC doesn’t allow you to claim tax relief for commuting to a permanent place of employment, you might be able to claim for other business mileage. For example, if you need to travel to different schools within the community. You can learn more about how to claim mileage allowance in our guide: How to claim mileage allowance of Self Assessment.

Are you a remote teacher conducting your classes online from your home? In that case, you may be able to claim tax relief on some utility bills like gas and electricity (but not rent or mortgage). 

Note that you can only claim for the percentage you use for business purposes. Additionally, you can only claim if you are required to work from home, not if you choose to for convenience. 

Find out more about deductible expenses you can claim from home in this downloadable guide. 

Running your teaching business may require you to do your own marketing to get the word out to schools and other clients. Teachers can claim for:

• Advertising in newspapers or directories
• Bulk mail advertising (mailshots)
• Website costs (building and running it)

However, you cannot claim for things like entertaining clients, suppliers and customers, or event hospitality. 

Self-employed teachers pay Income Tax and National Insurance at the following rates for 2021/22:

• Up to £12,570 – Personal allowance (0%)
• £12,571 to £50,270 – Basic rate (20%)
• £50,271 to £150,000 – Higher rate (40%)
• Over £150,000 – Additional rate (45%)

National Insurance is different since you have to pay it no matter how much you earn. However, you fall into different National Insurance classes depending on your situation. 

Self-employed teachers pay both:

• Class 2 National Insurance (self-employed taxpayers)
• Class 4 National Insurance (based on self-employed profits)

You can learn everything you need to know in our guide: How much National Insurance do I pay? The ultimate NIC guide for the self-employed.

Self-employed teachers claim tax relief on their Self Assessment tax returns. 

Record all your business expenses as proof of your costs and add up your allowable expenses on your tax return. Once you’ve added the total amount to your Self Assessment, send it in to HMRC. 

You don’t need to send in proof of expenses when you submit your tax return. However, HMRC might ask to see them, so make sure you keep your proof of expenses handy. 

Managing your business’ finances can be time-consuming, but Countingup makes it easier and faster, leaving you with more time to focus on doing what you enjoy.  

The all-in-one app helps you:

• Automate your expense categorisation and record receipts
• Plan for Self Assessment by providing real-time tax estimates
• Get insights into business performance with real-time profit and loss reports
• Get paid faster with instant invoicing  
• Connect your financial data directly with your accountant

Start saving time and money on your financial admin. Find out more here.