In its December employer newsletter, HM Revenue & Customs (HMRC) issued a reminder about the rules around employer-provided living accommodation stating that several exemptions exist in this respect where accommodation is provided for the “better performance of duties and the employment is one of the kind where it is customary for employers to provide living accommodation”. Agricultural workers who live on farms or on agricultural estates are cited in other HMRC guidance as one such kind of employment.
HMRC emphasises in its reminder that customary in this context does not apply to a specific employer alone, but where it is recognised as the norm and the exception is to fail to observe it.
David Chismon, a partner at Saffery Champness and a member of the firm’s Landed Estates Group, says:
“The customary test is satisfied where it is normal practice to provide living accommodation for an employee, and HMRC guidance confirms that there is no custom where less than half of the employees in a particular kind of employment are provided with living accommodation.
“That this reminder has been issued is perhaps a forewarning that this is one area where HMRC might be taking a closer look over the coming months, albeit the agriculture sector is seen as one where such provision is the norm.”