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HMRC internal manual

Employment Income Manual

Living accommodation: meaning of annual value

Sections 105(3) and 110 ITEPA 2003The legislation uses the words annual value to measure the value of the benefit of being provided with living accommodation (see


Annual value means:
* for living accommodation situated in the United Kingdom the gross rating value of the property under the old rating system. Some properties will not have a gross rating value, for example a property built after the end of the rating system. Take the notional estimated equivalent for properties where no gross rating value has been set. For the rating values to take for different parts of the United Kingdom see EIM11434. For an explanation of why the gross rating value is used see EIM11432. * for living accommodation situated outside the United Kingdom the amount the property could be let for on the open market. For the measure of this amount see EIM11440. The annual value of a property as determined for any rates or taxes in countries outside the United Kingdom is not on its own an acceptable measure for United Kingdom tax purposes.