Illustration 4 – Living accommodation Sachin Kaplan Study FA 23

Hi,

In the answer for (a) 1 requirement

Why they used the original cost of the accommodation for additional benefit and not the market value as Sachin moved into the house in Jun 2023 far from the original date Jun 2018,

Thanks,

Sachin lives in a house provided by his employer which cost £90,000, when it was acquired in June 2018.
Since this time the following improvements have taken place:
Date of expenditure:
Type of expenditure:
£
February 2019
Conservatory added Redecoration Garage extension
15,000
2,000
10,000
August 2021 July 2023
The house has an annual value of £1,700. The market value of the house was as follows:
£200,000 £165,000
April 2023 June 2023
The accommodation is not job-related and Sachin pays a rent of £100 per month to his employer.
(a) Calculate the amount assessable for the tax year 2023/24 in the following situations:
(1) Sachin moved in during June 2023.
(2) Sachin moved in during June 2023, but the property was actually acquired for £90,000 by his employer in June 2015.