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HMRC internal manual

National Minimum Wage Manual

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HM Revenue & Customs
Updated
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Pay reference periods & elements of pay - accommodation and accommodation related payments

Relevant legislation

The legislation that applies to this page is as follows:

For pay reference periods commencing

* on or after 6 April 2015; National Minimum Wage Regulations 2015, regulations 9 to 16
* before 6 April 2015; National Minimum Wage Regulations 1999, regulations 9 & 30 to 37

Accommodation

Special rules apply when living accommodation is provided by the employer to the worker (NMWM10040). This can happen in a variety of circumstances, not just when the employer is the worker’s landlord. It is important to apply the special rules carefully to establish if the employer is regarded as providing living accommodation to the worker.

If the accommodation is not living accommodation (NMWM10100) and/or is not regarded as provided by the employer (NMWM10040), then the accommodation offset rules will not apply.

Employers sometimes provide other accommodation-related payments and allowances to their workers either as a monetary payment to the worker via the payroll, by paying a third party or as a benefit. These must be considered on their own merits.

This would include situations where:

  • the employer pays a bill to cover a worker’s liability such as for council tax, water rates or a TV license (NMWM09130);
  • the worker pays a charge which is the employer’s liability, such as installing a landline required in connection with the employment (NMWM09170);
  • the employer pays for something the person needs to do their job, such as broadband access (NMWM09170);
  • The employer provides a benefit (NMWM09130) such as a television or electricity;
  • The employer pays an amount as an allowance (NMWM09090), such as an “accommodation allowance” or a relocation allowance;
  • The employer pays a regular amount as an element of pay, such as London Weighting (NMWM09090), a housing allowance or an amount to live close to work.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

If a worker makes payment to his employer or a third party in respect of living accommodation, or the employer deducts such sums from the worker’s pay, see (NMWM11040).