EMPLOYERS who kit out their staff in ‘informal’ uniforms are being warned they could fall foul of tax laws.

4couture, a Dorset company specialising in corporate clothing, says businesses should consider the issue as the financial year nears its end.

The company, based at Nimrod Way in Ferndown, says many clients do not know that giving their staff a uniform can be classed as a taxable benefit.

4couture director Lisa Morelli said: “With the growing trend for informal and more relaxed uniforms, clients often ask us to deliver a wardrobe that could be considered casual wear and therefore – without realising it – they could be falling foul of the law.

“As part of the design process, we establish the best way to ensure the garments are identifiable as uniform whilst still meeting the aesthetic needs of the client and their brand.”

HMRC allows two types of tax-free clothing. One is safety and protective gear and the other is uniform, defined as a set of clothing that an employee only wears to work.

But 4couture says that in hospitality businesses, reception teams and in retail, it may not be obvious to customers that staff are wearing a uniform.

It said: “For example, if you’re delivering suited garments, there a couple of questions you should ask yourself.

“Can you or your staff wear the garments out at the weekend without looking like you’re in your uniform? Can customers easily recognise you or your team?

“If your answer is yes to the first question and no to the second, then you’re potentially at risk of giving your staff a benefit in kind, which your staff will need to declare and pay tax on.”

Benefits in kind are usually perks such as company cars or private medical insurance, but uniform can count as well.

If clothes do not meet HMRC criteria, the garments will need to be declared and the employee will be liable to pay tax out of their own allowance.

The company said: “Another key point is the communication and delivery of uniform to your team. A great way to do this is by issuing a dress code which clearly states that the corporate wardrobe you are supplying to staff is strictly to be worn whilst undertaking their job and must be returned when they leave their role. It is also good to bear in mind that it is possible for your team to claim back uniform care and repair costs as an expense.”

The company says uniform can be made tax-free by adding printing, embroidery or more subtle ‘tax tabs’ for lightweight clothes that cannot take other methods of branding.