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HMRC internal manual

Employment Income Manual

Employer-financed retirement benefits schemes: excluded benefits: living accommodation and related benefits: benefits provided to employee's family

Section 393B(3)(d) Income Tax (Earnings and Pensions) Act 2003

Employer-Financed Retirement Benefits (Excluded Benefits for Tax Purposes) Regulations 2007 S.I. 2007 No.3537

See EIM15022 for provision to the employee’s family of accommodation that was provided for the performance of duties.

The regulations relating to living accommodation and related costs include a number of circumstances in which the provision of a benefit which has the character of a relevant benefit to the employee’s family is also an excluded benefit. Those circumstances are after any of the following events:

  • the employee’s death, (but see below further conditions for living accommodation provided to the families of deceased ministers of religion)
  • the employee’s taking up residence elsewhere as a result of ill-health, disability, infirmity or other physical or mental condition
  • the employee’s taking up residence elsewhere following a separation, annulment or divorce of a marriage or the nullity or dissolution of a civil partnership

In the last 2 circumstances, the ex-spouse or ex-civil partner shall be treated as a member of the employee’s family.

Families of deceased ministers of religion may continue to receive living accommodation as excluded benefits, so long as the death of the minister occurs when:

  • the minister was employed as a minister of religion immediately preceding death or
  • if the minister died after retiring, the minister must have either been employed as a minister of religion for the 5 years before retiring or have retired on grounds of ill-health