VAT Rules for Workwear, Uniforms, and Staff Clothing: What Businesses Need to Know

Navigating VAT rules around workwear and staff clothing can be surprisingly complex. While businesses naturally want to reclaim VAT wherever possible, HMRC sets strict criteria on what qualifies — and what doesn’t. Understanding the difference between workwear, uniforms, and ordinary clothing is essential to ensure compliance and avoid unexpected tax issues.

When VAT Can Be Reclaimed

VAT can be reclaimed on clothing that is solely for work duties and not suitable for personal use. This includes:

• Protective and specialist workwear — such as safety boots, high-visibility jackets, and lab coats.

• Profession-specific attire — like barristers’ wigs, theatrical costumes, or other items used exclusively in a professional context.

These items are clearly work-related, not practical for everyday wear, and therefore fall within the scope of VAT recovery.

Uniforms With Branding

HMRC takes a strict view on ordinary clothing. A suit or dress worn for work — even if required by the employer — does not qualify for VAT recovery. However, there is an exception:

Clothing that is clearly identifiable as a company uniform — for example, displaying a prominent logo — may qualify.

The key test here is whether the clothing could reasonably be worn outside work. If it could, HMRC generally considers it private clothing and disallows VAT recovery.

Staff Perks and VAT

Where clothing is provided as part of a staff benefit or perk, VAT can in many cases be reclaimed. But there is a catch:

If the cost of clothing provided as a gift exceeds £50 per employee per year, businesses must account for output VAT.

This rule helps prevent abuse of VAT relief through disguised perks.

HMRC’s Core Principle

Ultimately, HMRC only permits VAT recovery on clothing that is:

✅ Wholly for business use
✅ Not suitable for private use

Or, if it is clothing that could be worn casually, it must be a clearly identifiable uniform.

Final Thoughts

Businesses providing clothing to employees — whether PPE, uniforms, or branded apparel — should ensure they apply VAT rules correctly. Properly distinguishing between uniforms and ordinary clothing can prevent compliance issues and protect against unexpected VAT liabilities.

If in doubt, seek specialist advice. The cost of getting it wrong can be far greater than the value of the VAT reclaimed.