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Provision of living accommodation as taxable benefit

Provision of living accommodation as taxable...

A client has been offered a new post as a permanent employee of a company based in London.  My client lives in the South West.  The firm are offering to pay my client's travel expenses to London and provide him with living accommodation during the week, which they will pay for.

The proposed contract states that my client's place of work will be the firm's London office.  I assume that any travel expenses incurred between his home address and his place of work will be a taxable benefit if they are reimbursed, as these are ordinary commuting expenses.  They will need to be reported on the P11D.

Furthermore, if living accommodation is also provided to my client while he is in London, I assume that this will also be a taxable benefit, calculated using the HMRC guidelines at .  The living accommodation benefit will also be reported on the P11D.

My client is keen to avoid the tax and NI costs of the benefit in kind, and has asked if there is any way around this.  I cannot see one myself, as the firm do not have an office near my client's home (so his place of work would have to be London).  Even if his contract stated that his place of work was his home address, it would seem rather dubious if he was travelling to London regularly, and staying there during the week, and presumably HMRC could argue that his place of work was indeed London, rather than his home address. 

Any views would be appreciated.


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06th Jan 2013 17:13

Does that mean everyone agrees?!

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06th Jan 2013 17:22



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06th Jan 2013 17:26

I don't completely agree

The travel expenses are taxable (and NICable) as pay.

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06th Jan 2013 20:55

Thanks both.  

Thanks both.  George, thanks for pointing that out - I agree that the travel expenses would be dealt with as salary.

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