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Sam
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Category: Tax
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My husband has just taken a job in London. We live in Norwich.

Resolved Question:

My husband has just taken a job in London. We live in Norwich. Work have offered to give him a monthly allowance (up to £800) to rent a studio flat. Will he have to pay tax on this £800 because it's a benefit in kind (even if the place he rents is £800 and all the money is going on rent)? If so, how much tax will he have to pay? (He is in the 40% tax band). It would seem very unfair if we end up out of pocket because of the flat he has to have to do his job. Thank you for your help. Louise Baker
Submitted: 1 year ago.
Category: Tax
Customer: replied 1 year ago.
If we do have to pay tax can you tell us some ways we might reduce / avoid it? Does it make a difference if he does a mon to fri let for example?
Expert:  Sam replied 1 year ago.
Hi
Thanks for your question - I am Sam and I am one of the UK tax experts here on Just Answer )I am ex HMRC and now run my own accountancy business)
Yes your husband will be liable to this allowance as its a benefit. He choose to take the job in London and so should either pay to rent himself or pay the tax that arises on the £800 (as if it was an extension on salary)
He will pay £800 x 40% = £320 per month (so its better then being £800 out of pocket!)
I appreciate you think its unfair but HMRCs stance on this is that - it was his choice to take this job furtehr from home, and none of us get help with our rents or mortgage payments - whether we live locally OR have to pay rents elsewhere.
Even if he was in hotels he still would be labile to tax and this costs puts him in a position to do the job rather then being incurred in the course of performing his job.
I am sorry there is no more to help with this situation (if there was I would offer as expenses and benefits in employment, and self employment was the topic I educated taxpayers on whilst with HMRC)
Let me know if I can assist further - but if you do not need any further help then please do take the time out to rate me for the level of service provided
Thanks
Sam
Sam, Accountant
Category: Tax
Satisfied Customers: 13775
Experience: 26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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