Millions of taxpayers across the UK could see their effective Tax-Free Personal Allowance rise to £13,006 thanks to a series of little-known reliefs administered by HM Revenue and Customs (HMRC).
The standard Personal Allowance remains at £12,570, but specific tax reliefs can increase the amount of income you keep before paying tax. Understanding these rules could put hundreds of pounds back in your pocket.
Claiming Tax Relief for Work Expenses
One key method to boost your allowance is by claiming tax relief on work-related expenses you pay for yourself. You may be eligible if you use your own money to buy essential items solely for your job, such as specialist tools, uniforms, or professional subscriptions.
You cannot claim this relief if your employer fully reimburses you for the cost, or provides a suitable alternative. For example, if your employer supplies a work laptop, you cannot claim for a different model you personally prefer.
If your employer has covered only part of an expense, you can claim tax relief on the remaining amount you paid.
Other Routes to a Higher Allowance
Another valuable relief is Maintenance Payments Relief. This can reduce your Income Tax bill if you make maintenance payments to an ex-spouse or former civil partner.
To qualify, all the following must apply: either you or your ex-partner were born before 6 April 1935, you are paying maintenance under a court order after the relationship ended, and the payments are for your ex-partner (provided they have not remarried or entered a new civil partnership) or for your children under 21.
Successfully claiming these reliefs can add £436 to your effective Personal Allowance, pushing the total over the £13,000 threshold.
Charitable Giving and Tax Efficiency
Donations to registered charities or Community Amateur Sports Clubs (CASCs) are also tax-free. This tax relief can go to you or directly to the charity, depending on how you donate.
Methods include using Gift Aid, where charities claim an extra 25p for every £1 you give at no additional cost to you, payroll giving directly from your wages or pension, or donating land, property, shares, or money in your will.
These rules apply to sole traders and partnerships, with different regulations governing limited companies.
With careful planning and by understanding HMRC's rules, taxpayers can legitimately increase their tax-free income, ensuring they keep more of what they earn while supporting work, family, or charitable causes.
