Can You Claim VAT Back on Work Clothing? A Practical Guide for UK Businesses

Can You Claim VAT Back on Clothing? Here's What You Need to Know

At first glance, it might seem perfectly reasonable to claim back VAT on clothes your staff wear for work. After all, if you’re buying clothing purely for business purposes, surely it counts as a business expense?

As with many things in tax, the answer isn’t always straightforward.

Uniforms and Protective Clothing: A Clear Yes

If the clothing is clearly work-related, think branded uniforms, helmets, hi-vis jackets, or steel-toe boots, HMRC generally agrees that the VAT can be reclaimed. These are items bought solely for employees to perform their duties safely or in line with industry regulations. For example, a construction firm providing hard hats and protective gloves to site workers would usually be allowed to reclaim the VAT, as the cost is directly linked to running the business.

Similarly, professionals in very specific dress codes can also be covered. Take barristers, for example. They’re required to wear traditional courtroom attire, including wigs, gowns, and dark suits. HMRC accepts that if this clothing wouldn’t be purchased outside of court requirements, the VAT is claimable.

But What About Office Wear?

This is where things get trickier. You might assume that a formal suit for an office worker counts as a uniform, especially if it's required by company policy. Unfortunately, HMRC doesn't see it that way.

According to current guidance, just because a business wants its staff to "look smart" doesn't mean the VAT on suits or other professional clothing can be reclaimed. The key issue is whether the clothing is considered something that could also be worn outside of work. Since suits, shirts, and smart shoes can be worn in everyday life, they’re not seen as work-only items, and so the VAT remains non-recoverable.

A Few Real-World Examples

Tax tribunals have made some interesting rulings over the years that help shed light on this issue. In one case, an art consultant argued that dressing well was essential to present a professional image and win clients. While that might sound reasonable, the tribunal didn’t agree and ruled that looking smart wasn’t enough to justify VAT recovery.

In another case, two shop owners tried to claim VAT back on the suits they wore in their boutique. Again, the tribunal found that dressing well was a personal choice rather than a business necessity, and the claim was denied.

On the other hand, one rather unusual case involved a musician who wore a wig as part of his stage persona. He argued that without the wig, his image, and therefore his brand, would change, affecting album covers, posters, and other marketing materials. Surprisingly, the tribunal sided with him, ruling that the wig was a business asset, and he could reclaim the VAT.

The lesson here? If the clothing is exclusively tied to a specific work function (especially if it's theatrical or image-based), the VAT might be allowable. But if there's any personal use involved, HMRC is likely to say no.

What About “Perks” Like Branded Clothing?

There’s also a rule around business gifts that can occasionally be helpful. If you give staff clothing as a perk, for instance, a branded hoodie or jacket, the VAT might be recoverable. However, there’s a catch: if the total value of those gifts exceeds £50 (excluding VAT) in a 12-month period, your business must account for output VAT on them. That can cancel out the benefit of reclaiming it in the first place.

So, if you're handing out branded T-shirts or jackets to staff, keep the cost modest and make sure they stay under that £50 limit if you want to avoid the additional VAT charge.

In Summary

While it is possible to reclaim VAT on certain types of clothing, the rules are strict and depend heavily on the nature and use of the clothing. Items like protective gear or official uniforms are usually fine. But everyday clothing, even if worn exclusively at work, is unlikely to qualify unless it has a very specific business function or can't reasonably be worn outside of work.

If you’re unsure whether a clothing expense qualifies, it’s always worth checking with your accountant or reaching out to HMRC for guidance. Getting it wrong could mean more than just losing a VAT refund, it could raise bigger compliance questions down the line.

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