ECH18110 - Working Rule Agreements (WRA) - Action Required When Retention of Rooms Allowance Paid

When an employer pays a retention of rooms allowance (retainer) as described at ECH18105 without deductions, whether the payment is made

• to the employee or
• direct to the provider of the accommodation

you should check that

• the employees concerned qualify for tax and NIC free lodging allowance ECH18080 
• the payments made are within the WRA retainer limits
• the employer has applied the special tax and NIC arrangements correctly
• and where required by the WRA, proof of payment by the employee is held by the employer.

Where any of the above conditions are not satisfied, you should

• advise the employer of the correct procedure for the future and
• seek recovery for earlier years, where appropriate.

Note that the method of payment will determine the advice given and how recovery is made

• if payment is made to the employee this is a cash earnings whereas
• payment direct to the accommodation provider is a benefit in kind or pecuniary liability.

• (This text has been withheld because of exemptions in the Freedom of Information Act 2000)