Chapter 3 - 2.2 - Living Accommodation Owned by the Employer

Question 1

What is the basic benefit if the employer owns the property?

Answer 1

The rateable value (given in the question)

Question 2

When is there an additional benefit?

Answer 2

If the original cost of the house exceeds £75,000

Question 3

How is the additional benefit calculated?

Answer 3

(‘Cost’ - £75,000) x official rate of interest at start of tax year

Question 4

What is ‘cost’?

Answer 4

Generally the original value when the employer purchased the property

Question 5

What should you use as the ‘cost’ if the employer owned the property for more than six years before the employee moved in?

Answer 5

The market value at the date the employee moved in as the ‘cost’ for calculating the benefit

Question 6

What is the official rate of interest from 6 April 2023?

Answer 6

2.25%

Question 7

Between when should you include any capital improvements (renovations e.t.c)?

Answer 7

Between the date on which the ‘cost’ is determined (date of purchase/employee moving in) up to the start of the tax year

Question 8

How are employee contributions treated?

Answer 8

They are deducted from the value of the benefit