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HMRC internal manual

Employment Income Manual

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HM Revenue & Customs
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Particular benefits: alterations, additions and repairs to living accommodation

Section 313 ITEPA 2003

Where living accommodation is provided for a director or employee (or for members of his family or household), except for 2015/16 and earlier those in an excluded employment (see EIM21007), by reason of his employment, no chargeable benefit arises in respect of:

  • any structural alterations and additions to the premises or
  • repairs expenditure that would normally be the landlord’s responsibility.

For this purpose expenditure that would normally be the landlord’s responsibility covers repairs of:

  • the structure and outside of the property including drains, gutters, and external pipes etc
  • installations in the property for the supply of water, gas and electricity
  • sanitary installations including sinks, baths and toilets
  • space and water heating installations.

This kind of repairs expenditure maintains or enhances the value of the property to the landlord rather than providing a benefit to the employee. That is why the expenditure is not charged as a benefit on the employee.

As regards the heating, lighting and cleaning etc of job-related living accommodation, see EIM21720 onwards.

Although the cost of structural alterations and additions is not charged as a separate benefit on the employee, it is taken into account in determining the cost of the property for the purpose of any charge on the benefit of provided living accommodation (see EIM11301 onwards).