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HMRC internal manual

Employment Income Manual

Tax treatment of doctors: pre-registration house officers: living accommodation

Doctors in training grades may be considered to be in a different type of employment from doctors employed in career grades. In particular, although hospital doctors may be employed in one of three training grades – pre-registration house officer (PRHO), senior house officer and specialist registrar – employment as a PRHO is clearly distinguishable because a PRHO is still a student. Although a PRHO uses the title of Doctor, this title is provisional on the satisfactory completion of a year of clinical training.

Position before 1 August 2008Before 1 August 2008, HMRC accepted that it was customary for employers to provide living accommodation for PRHOs for the better performance of the duties. Consequently, PRHOs satisfied the conditions in section 99(2) ITEPA 2003 (see

EIM11346) and were exempt from charge to tax under Part 3 Chapter 5 ITEPA 2003 in respect of the provision of living accommodation.

Position from 1 August 2008It has ceased to be a contractual requirement applying across the United Kingdom for all PRHOs to be provided with living accommodation during clinical training. This means that, with effect from 1 August 2008, HMRC no longer accepts that it is customary to provide living accommodation in these circumstances. Therefore, PRHOs are not entitled to the exception from the living accommodation benefit charge in section 99(2) ITEPA 2003.

Where, from 1 August 2008, an NHS employer continues to provide free living accommodation to PRHOs, a taxable benefit will arise in the normal way.