There are special rules for the provision of living accommodation for employees. In most cases, employees will pay tax on any living accommodation provided by an employer unless they qualify for an exception.

However, where an employee qualifies for an exemption, there is no tax to pay on the provision of living accommodation. The definition of living accommodation includes houses, flats, houseboats, holiday homes and apartments. It does not include hotel rooms or board and lodgings.

An exception for living accommodation will usually apply in the following cases:

Other charges and costs

If the accommodation you provide is exempt, you do not have to report Council Tax, water and sewerage charges to HMRC, or pay National Insurance and tax.

Source:HM Revenue & Customs | 11-12-2023