EIM11472 - Living accommodation: properties costing more than £75,000

Section 106 ITEPA 2003 and Extra-Statutory Concession A91b

The amount of the benefit depends on the cost of the property (see EIM11428).

For the definition of the cost of providing the living accommodation see EIM11429.

This page relates to living accommodation that cost the provider more than £75,000. If the cost of the accommodation exceeds £75,000, then the amount of the cash equivalent is calculated in accordance with Section 106 ITEPA 2003.

There is one exception. If the annual value is based on the open market rental, then Extra- Statutory Concession A91b applies. Under ESC A91b the cash equivalent of the benefit is restricted to step 1 of Section 106(2) ITEPA 2003. The amount of earnings under step 1 is the same figure as that calculated under Section 105 for properties which cost £75,000 or less (see EIM11431).

ESC A91b usually applies to properties outside the United Kingdom (see EIM11440).

If it appears that the property cost more than £75,000 then the first thing to decide is whether the cost basis or the market value basis will be used to calculate the cash equivalent of the benefit (see EIM11473).