EIM11337 - Living accommodation exemption: meaning of representative occupier

Former representative occupier posts can qualify for exemption under an extra statutory concession (ESC) from any benefit arising under Part 3 Chapter 5 ITEPA 2003 on provided living accommodation (see EIM11336). A representative occupier is an employee:

• who resides in a house provided rent free by the employer
• who as a term of the contract of employment is required to reside in that particular house and is not allowed to reside anywhere else
• whose occupation of the house is for the purpose of the employer, the nature of the employment being such that the employee is reasonably required to reside in it for the better and more effectual performance of the duties.

See Tennant v Smith (3TC158), Reed v Cattermole (21TC35) and Gray v Holmes (30TC467).

Withdrawal of the concessionary treatment

This ESC will be withdrawn from 6 April 2021 (see EIM11339). Announcing this policy change now should allow both employers and employees affected by the ESC’s pending withdrawal to make the necessary contractual arrangements. It will also give time for employers to consult with HMRC on an employee’s possible entitlement to existing statutory exemptions where they may be affected by this change.