12. Accommodation

See also:

12.1 Job-related accommodation

(a) Definition and scope

In certain, limited instances, the University will require employees to reside in accommodation provided by the University. Where this is the case, accommodation may be provided either for the employee alone or for the employee and their immediate family.

The tax treatment of such accommodation is complex and only tax-free for a limited number of roles and specific circumstances.

(b) Accommodation that is not taxable

Accommodation provided rent-free (or at a subsidized rate) by the University is taxable unless it is provided on the following basis:

Subsidized University living accommodation that is not taxable:

Category

Includes

Representative occupiers

  • Vice Chancellor;
  • Registrar;
  • Wardens or Heads of House in colleges.

Where it is necessary for the proper performance of the duties of the individual

  • Director of the Botanic Garden;
  • Superintendent of the University Parks;
  • Foresters / Conservators at Wytham Woods;
  • Gardeners;
  • Night Porters;
  • Residential Caretakers.

‘Representative occupiers’ are specific roles that existed within the University prior to April 1977 which the then Inland Revenue accepted as exempt from tax via an extra-statutory concession. As long as the fundamental nature of such roles continues unchanged then the requirement to live in ‘representative accommodation’ will continue to be treated as tax-free. It is not possible, however, to identify new roles under this concession.

All other exemptions are provided on the basis that accommodation is necessary for the proper performance of the duties of the individual. This is interpreted very strictly by HMRC and case law to mean that it is essential for an individual to occupy a specific property in order for them to do their job, e.g. to be on 24-hour call to the associated facility. Convenience or desirability is insufficient in itself, and accommodation must always be within property owned by the University to qualify for exemption.

For individuals not falling within either of these categories, any accommodation-related costs borne by the University will be taxable via the P11D process.

For both categories of exempt accommodation, only those costs detailed below may be provided free of tax.

(c) Tax-exempt costs

For individuals who satisfy the criteria for tax-exempt accommodation, the following costs may be paid by the University without there being a tax charge.

Tax-exempt accommodation costs when borne by the University:

  • Rental (in whole or part) for occupation of the premises;
  • Structural maintenance of the property, including repairs to the fabric of the building, external maintenance of gutters, drains, etc;
  • Internal decoration, only where this is carried out prior to initial occupation or in making good after structural maintenance as outlined above;
  • Water rates and council tax charges.

Only the items listed above are tax exempt. The following examples show items that are NOT exempt, even for persons in the tax-exempt categories.

Taxable accommodation costs when borne by the University:

  • General maintenance, such as repairs to fixtures or fittings, gardening, etc;
  • Internal decoration of the property other than when making good after structural maintenance whilst the tenant is in occupation;
  • Gas, electricity, heating and lighting costs;
  • Provision of furniture, other than items in distinct public areas that remain at all times the property of the University.

The University Land Agent is responsible at all times for the administration and maintenance of University owned accommodation. All costs will be paid directly by the University and may not be paid then reclaimed by individual occupants.

Where taxable costs are paid for by the University then there is a reportable benefit to the individual that must be notified under the P11D process.

Where individuals occupy accommodation that is a part of a larger University facility, e.g. residential caretakers, and bills for that facility are paid for the building as a whole, then the share of taxable costs attributable to the individual's accommodation must be calculated and reported as a taxable benefit via the P11D process.