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Categories explained: Employee Living Accommodation
Categories explained: Employee Living Accommodation
Steven Anderson avatar
Written by Steven Anderson
Updated over a week ago

Sometimes employers will pay for their employees living accommodation expenses, including for example their monthly rent bill. This usually forms part of their employment contract and you must make sure that it is reported as a benefit in kind whereby the employee will pay personal tax on the benefit.

What's included

If one of your employees or one of their relatives is living in accommodation provided by the company.

Also includes if you as a company covers costs such as:

  • Council Tax, water and sewerage charges

  • Furniture, heating, lighting maintenance

What's not included

You don't have to report or pay anything to HMRC on the cost of certain types of accommodation such as:

  • If it's domestic or personal

  • If it's provided by a local council

  • If it's necessary or usually provided for the job

  • If it's needed for security

Check out the links for further info of each of these exempt situations.

How is it taxed?

How the tax is worked out depends on whether the accommodation cost more than £75,000.

Tax tips

Make sure to check out how to work out how much tax to deduct from your pay at the HMRC guidance here.

Useful links

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