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Employer provided accommodation: will HMRC shut the door?

HMRC have announced that the Extra Statutory Concession (ESC), which exempts employer provided living accommodation from being a taxable benefit when made available to a ‘representative occupier’, will be withdrawn from 6 April 2021.

A representative occupier is defined as an employee:

The representative occupier ESC is a longstanding practice with roots in pre-1977 legislation. It should not be confused with the statutory exemption that most employers in the agricultural sector rely on, namely where living accommodation provided for an employee is not taxable if it is ‘necessary for the proper performance of the duties’, or is ‘for the better performance of the duties’ and is ‘customary’ in that type of employment.