Consultation outcome

Taxation of self-funded work-related training

This consultation has concluded

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Detail of outcome

Budget 2018 sets out the government’s vision for developing the new skills needed for the UK’s long-term prosperity, in order to build an economy fit for the future. The government is committed to creating an environment to support people to develop the skills needed, responding to the opportunities that will be created by longer working lives, automation of low skilled labour and changes to the labour market. It is committed to finding the most effective policy interventions, which ensure value for money and best deliver the government’s objectives in boosting aggregate productivity.

The government has considered the case for an extension of tax relief for self-funded work-related training. On the basis of the evidence and the consultation responses, the government has decided not to extend the existing tax relief for employees, the self-employed, or for retraining. Responses to the consultation were mixed and the government has concluded that there is insufficient evidence that extending tax relief is likely to be effective in incentivising self-funded work-related training. After close consideration, the government believes other policy interventions will be more effective in delivering support and addressing the barriers to learning. These include launching the ambitious National Retraining Scheme to help those in work, including the self-employed, develop the skills they need to thrive.

Original consultation

Summary

A consultation on the extension of tax relief for training by employees and the self-employed to support upskilling and retraining

This consultation ran from
to

Consultation description

A skilled workforce benefits both individuals and the wider UK economy. The government is focused on creating an environment for individuals to develop their skills to boost productivity in the UK. The Autumn Budget 2017 announced that the government would consult on how it could extend the existing tax relief available for self-funded work-related training by employees and the self-employed. The government wants to gain an understanding of:

  • how it can best learn the lessons from previous initiatives, such as vocational training tax relief in the 1990s, and tax deductions for training in other countries

  • how it could design an extension to the existing tax relief that focuses on supporting good quality training for those wanting to upskill or retrain, particularly those who want or need to change career

  • how it could design an extension that prevents misuse on recreational activities, is sustainable for the public finances, and is simple to understand and administer

Documents

Published 13 March 2018
Last updated 29 October 2018 + show all updates
  1. Updated with 'Taxation of self-funded work-related training: summary of responses'.
  2. First published.