| Benefits Code I and Exemptions and Exclusions |
19 |
Vertigan v Brady70 the taxpayer failed to come within (b) because the provision of accommodation was not sufficiently common to be ‘customary’. Among the issues considered by the court were (i) how many employers in this industry provided accommodation, (ii) for how long the practice had continued, and (iii) whether it had achieved general acceptance. |
15A.4.1.6 The Charge |
Assuming for the moment that the cost of providing the accommodation does not exceed £75,000, the charge is on the rental value to the employee of the accommodation for that period. A deduction can be made for any sum made good by X to the person at whose cost the accommodation is provided.71 Rent paid by the employee is therefore deductible. Benefits in kind provided in return may also, in principle, be taken into account but only if they relate clearly to the accommodation.72 The rental value is calculated by reference to the annual value under ITEPA section 110 TA 1988, section 837. If those at whose cost the accommodation is provided pay rent which is higher than the annual value, that higher figure is to be taken.73 In the absence of any provision directing otherwise it is to be assumed that in calculating the annual rent hypothetically payable, account is taken of all the terms of the occupation, even those imposed in connection with the office or employment. The employee may deduct from the value as ascertained any sums allowable under ITEPA part 5 chapters 2 and 5.74 |