Sectors which reported significant use of living accommodation included education, ministers of religion, agriculture and carers and nannies. One quarter of respondents who provide living accommodation are in the education sector. Almost 85% of respondents stated that the accommodation provided reflects what is needed to undertake the role. The majority of respondents (82%) agreed that the current categories of accommodation cover the circumstances of employers and employees today. Calculating the taxable value of accommodation provided proved very difficult for 10% of respondents, however a further 10% of respondents found it very easy. Most respondents reported that their employees are not expected to pay rent for their accommodation. 100% of respondents agreed that using market rental value would provide a simplification to the tax rules on provided living accommodation. 80% of respondents agreed that it was still appropriate for certain accommodation to be completely exempt from tax, despite the fact that others may see it as a benefit. Conclusion With most respondents stating that living accommodation is provided because it is necessary to enable the worker to do the job, the majority of respondents also state that the current categories of accommodation are still relevant for their workers. A view supported by results which show that most respondents provide accommodation for those in education, agriculture, care work or as ministers of religion. However the survey shows that respondents experience varying degrees of difficulty when trying to establish the taxable value of accommodation, and obtaining advice from the District Valuer has also proved difficult for several respondents. And whilst few respondents expect employees to pay rent for their accommodation, there is unanimous agreement that the tax rules for living accommodation could be simplified by using the market rental value. Recommendations In light of these results the CIPP recommends that the government does not make wholesale changes to the system when one is not called for, but instead introduces genuine simplifications such as to the process for calculating the taxable value of accommodation, with advice from the District Valuer being much more accessible than would currently appear to be the case.
The full response is available through the link below.
CIPP response to consultation on employer provided living accommodation
Payrolling Benefits in Kind guidance 8 February 2016
The supplementary guidance for the Payrolling of Benefits in Kind has now been published on GOV.UK.
From the start of the tax year 2016 to 2017, you can choose to account for the tax on the benefits you provide to your employees through PAYE each payday. You must register before 6 April 2016 to start payrolling for tax year 2016 to 2017.
Payrolling Benefits in Kind guidance
Bespoke scale rates and transitional arrangements 9 February 2016
Applications to continue to use a previously agreed rate will need to be made in sufficient time to allow an approval notice to be issued by HMRC prior to 6 April 2016.
From 6 April 2016 employers will no longer be able to apply to HMRC for a dispensation in relation to expenses or benefits that they pay, reimburse or provide to employees and which would previously have been fully matched by a deduction from the employee’s earnings. All existing dispensations will cease to be effective after 5 April 2016.
HMRC has recently revised their Employment Income Manual (EIM) to cover the changes.
The EIM includes details about the new bespoke scale rate process and the transitional arrangements.
CIPP Policy News Journal
25/04/2016, Page 153 of 453
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