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Renting a house rather than Hotels - allowable?

Client Query for workers

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Hi All,

 client of ours has contracts down south. Employees regularly drive from Manchester to the south and they are put up in hotels. The work they do there is adhoc and there are various employees that do the work/commute.

The client is looking at renting a house there and paying the utilites etc so that it would be available for employees to stay over when they travel down there rather than hotels - they feel this would be cheaper.

Would there be any issues with this? BIK etc - the client has confirmed it would not be made available for personal use and would only be used for the purpose of attending the jobs when they are there?

Many thanks

Replies (4)

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By Accountant A
24th Jun 2019 11:04

What's your thinking, as a matter of interest?

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RLI
By lionofludesch
24th Jun 2019 11:20

Would these workplaces down south always be temporary workplaces ?

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By triffid
24th Jun 2019 12:21

I think does not matter if the workplace is a temporary one or not. The costs will always be a legitimate business expense as long as the employees have there own home (or rent live with parents etc). The expense will be allowable deduction for corporation tax.

If the workers don't have their own home and this is their main residence then only if it is customary and required for the job such as clergy and pub landlord is it not BIK.

Now if it is a tax free benefit to the employee does depend on if it is a temporary place of work.

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By atleastisoundknowledgable...
24th Jun 2019 17:53

Similar but different- Northern based events Ltd client of mine is thinking of buying a house in London to house it’s e’ees when they work at / PM an event in London. May be 1 night or 2 months for 1-5 staff (incl sole Director/shareholder) at a time. They will also get rental income from renting out to other event cos.

Currently they’re spending a fortune on long stays in hotels / Air BnBs.

I’m planning on full CT relief for expenses and mortgage interest with no BiK - am I wrong?

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