What expense category does a uniform come under?

Trying to figure out where to categorize your uniform expenses? Properly classifying uniforms in your accounting isn't always straightforward, but getting it right can make a big difference in your financial records and taxes.

Classifying uniform expenses

Uniform expenses can serve different purposes in your business, so how you categorize them depends on how they’re being used.

• Clothing: Standard work attire that's required but suitable for everyday wear.
• Protective equipment: Gear designed for safety.
• Workwear: Specialized garments necessary for specific jobs.
• Advertising: If uniforms prominently display your company's branding, they might be considered marketing expenses.

Examples of uniform expenses

Below is an example in each category mentioned above to give you an idea of how to classify uniform expenses in practice.

• Company-branded shirts worn by staff fall under clothing.
• Helmets, safety wests, fire-resistant clothing for welders or steel-toed boots for construction workers are typically classified as protective equipment.
• Lab coats for scientists. overalls for mechanics, chef's aprons or medical scrubs are usually classified as workwear.
• T-shirts with your company's logo given away at events fall under advertising.

For instance, if you spend $1,000 on branded uniforms for your customer service team, you might categorize this under "clothing" or "advertising" depending on their use.

Tax implications of uniform expenses

How you categorize uniform expenses can affect your taxes. Keep these points in mind:

• Deductible expenses: Uniforms required for work and not suitable for everyday wear are typically tax-deductible.
• IRS guidelines: To qualify, the uniforms must be mandatory and not adaptable to general use.

Always maintain detailed records and receipts of all uniform purchases. And be sure to consult a tax advisor to navigate IRS regulations and maximize deductions. Accurate categorization ensures compliance and helps you take advantage of potential tax savings.

Let Ramp automate your expense process

Managing uniform expenses doesn't have to be complicated. Ramp automates the categorization and tracking of all your expenses, including uniforms. Save time, reduce errors, and gain insights into your spending. Let Ramp simplify your expense management so you can focus on running your business.