As some of you may be aware, for the past 12 months we have been battling with HMRC to get IIBA recognised as a "professional association" for income tax purposes. This is significant as it means that our members will be able to claim tax relief against their membership fees. Indeed, if you are a member, you may be able to claim tax back against your IIBA and IIBA UK subscription fees.
I am pleased to say that HMRC has formally approved our application. We have received written confirmation that HMRC will recognise IIBA UK Chapter and IIBA HQ (Canada) under the relevant guidelines. This has been backdated to April 2013.
What this means for you if you are an individual member who is also a UK Income Tax payer:
It is possible that you may be entitled to claim tax relief against the amount you pay for your IIBA UK and IIBA subscriptions.
Based on today's USD to GBP FX rate, and based on our understanding of the tax system, a rough "back of a napkin" calculation (please be sure to seek advice from your accountant HMRC for your individual circumstances)
For a higher rate tax payer who is a member of IIBA and IIBA UK this could be worth ~ £37 / year (per member) in tax relief.
For a basic rate tax payer who is a member of IIBA and IIBA UK this could be worth ~ £18 / year (per member) in tax relief.
How to claim the tax relief:
Based on our understanding, tax relief can be claimed as follows:
1. People who self-fund their subscriptions and are PAYE:
To benefit from the tax relief, these members should ring their tax office and ask to have this 'coded in' to their tax code. They may need to quote the following reference number: to claim this (as it doesn't yet appear on HMRC's "List 3", which is only updated occasionally):
Head office reference: RHT/T1644/08/2013/JEM/IJC
2. People who self-fund their subscriptions and are Self Assessment:
We assume this would be declared at tax year end, as part of the self assessment process, but please contact HMRC with any queries.
Please be sure to speak to HMRC and/or your accountant to check suitability for your individual circumstances. However, we're really pleased that HMRC have finally approved our application!
Adrian Reed -- President, IIBA UK