The Government first announced plans for a shared ownership right to buy in October 2019. At the time the sector raised concerns about the impact the plans would have on housing associations ability to borrow. An election and a pandemic later the Government announced, during the CIH Housing Festival last week, the return of the right to shared ownership as part of its Affordable Homes Programme (AHP).
With the budget just days away, it may well be that the Government unveils its response to this shortly. It seems likely that some employees, such as church ministers and those living in sheltered housing schemes, who are provided with accommodation tax free may in future be taxed on provision of that accommodation.
Although employer-provided accommodation is generally taxable, there are a number of exemptions that exist. These exemptions principally apply where accommodation is necessary for the proper performance of the employee’s duties or it is customary for the better performance of the employees’ duties. Examples of the sorts of roles where accommodation has previously been provided tax free include caretakers, church ministers and wardens of sheltered housing schemes.
The Government set out 16 questions in the call for evidence. The questions are essentially based on 3 themes:
- why accommodation is provided;
- what type of accommodation is provided; and
- do jobs require accommodation to be provided?
The Office for Tax Simplification considered that the exemptions from tax of living accommodation provided by employers weren't clear and were outdated and arbitrary. It also felt that the value of the benefit provided is often difficult to calculate. The Government has particularly been considering whether exemptions are still relevant given the increasing availability of technology, good transport links and more flexible ways of working.
The Government has said that it proposes to revise the rules with a view to making them simpler. It also seems likely that they will take the opportunity to fundamentally redraw the exemptions. This could mean some significant changes.
For instance, it has historically been the case that it was helpful for church ministers to live close to the church building in order to help them perform their duties. Whilst this made sense when people tended to go to their local church, with people travelling from longer distances to go to a particular church and with technology making communication with church members easier, it is conceivable that the Government may consider that this exemption is no longer appropriate.
Similarly, with the advance of technology it may no longer be so important for the warden of a sheltered housing scheme to live on site. Personal care alarms, tele-care systems and mobile phones mean that there are now different ways of alerting staff to emergency situations. It could be that the Government decides to tighten the criteria for an exemption from tax for wardens of sheltered housing and those in similar roles.
For more information
For advice in relation to employer provided accommodation, please contact Doug Mullen.
Two final pieces of the possession jigsaw have been published on 15 September 2020. Mr Justice Knowles’ working group on possession proceedings has issued its guidance on the “overall arrangements” for possession proceedings.
One change proposed by the Building Safety Bill is the introduction of a duty holder regime, which will see statutory responsibility for the safety of higher risk buildings placed on key individuals
Throughout this pandemic, the Competition and Markets Authority (CMA) has been publishing various “Statements on Coronavirus” (Statements) which provide guidance on consumer rights during this time.
A recent increase in COVID-19 cases in the UK means new measures are being put in place in an effort to reduce the risk of a second wave. Whilst the impact of COVID-19 continues to be felt, it is important to remain focused on the sector’s road to recovery.
Sometimes half an hour at a conference gives you the reality that has been staring you in the face all along. That was my experience watching “Change is on the Horizon”
Following our recent e-briefing on Possession Notices, Helen Tucker and Emilie Pownall from our housing litigation team discuss the impact of the changes on social landlords.
Not only has the possession stay been extended until 20 September, the notice periods to be given to tenants has been extended in certain circumstances with some important exceptions.
The Court has confirmed that a party cannot withhold its consent in order to re-write the original bargain.
Following the Grenfell Tower tragedy, building safety continues to be a key concern for social housing providers and their residents.
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