If the employee is taxable under the Income Tax (Earnings and Pensions) Act 2003 Part 3 Chapter 51 and the cost of the accommodation exceeds £75,000, the tax charge on the employee2 is increased by 'the additional yearly rent'3. Essentially, the employee is treated as if he or she received a loan of the amount by which the cost exceeds £75,000, and a percentage of that loan representing a deemed interest amount is treated as additional income of the employee in that year
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