Hi tutor
Regarding the taxable benefit of living accommodation, is time apportion needed?
As I read from the past paper below, it seem is only time apportion the rent paid by employer, but not the annual value. This is in contrast to what I read from the ACCA technical paper, which does time apportion the annual value. Thanks.
Regards,
Kelvin
ACCA technical paper
https://www.accaglobal.com/in/en/student/exam-support-resources/fundamentals-exams-study-resources/f6/technical-articles/benefits-2020.html
As per the past paper,
Alina – provision of temporary living accommodation:
– Dent Ltd will rent a flat for Alina’s use from 1 July 2019 to 31 December 2019.
– Dent Ltd will pay the rental cost of £660 per month.
– The market value of the flat is currently £225,000, and its annual value is £2,800.
Accommodation benefit: Higher of
(i) annual value = £2,800
(ii) rent paid by Dent Ltd = £3,960 (£660 x 6)
Ask the Tutor ACCA TX-UK
March/June 2019 ATX UK Dent Ltd Q3 - Annual Value
The annual value should of course be time apportioned but it may just be a badly worded question and they meant to give you the annual value for the 6 month period rather than the figure for the whole tax year - as long as you showed your calculations you would be marked correct here
Thanks tutor!
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