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HMRC internal manual

Employment Income Manual

From
HM Revenue & Customs
Updated
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Accommodation: preventing a double charge

Part 3 Chapters 1 and 5 ITEPA 2003Where accommodation provided by the employer is living accommodation there is a possibility of it being included twice in employment income: once as earnings within Section 62 ITEPA 2003 and again as a benefit under Section 102 ITEPA 2003 (see

EIM11401 onwards). This would be unfair and it is prevented by Section 109 ITEPA 2003.

In any case where the accommodation is included twice in employment income and you have these two full charges Section 109 tells you to:
* calculate the amount of earnings under Section 62 * calculate the cash equivalent of the benefit under Section 103 ITEPA 2003, then * calculate the excess, if any, of the earnings under Section 62 over the cash equivalent of the benefit under Section 103.The amount of employment income chargeable under Section 6 ITEPA 2003 is the total of the cash equivalent of the benefit under Section 103 plus the excess calculated above.