Accommodation Offset

Is the accommodation offset a pre tax or post tax deduction?

Hi,
The accommodation offset is neither a pre tax or post tax deduction. 
Accommodation is the only benefit in kind that can count towards the National Minimum Wage and special rules apply when calculating a worker’s National Minimum Wage pay.
These special rules are known as the accommodation offset.
The accommodation offset only applies when both:
•    the employer is regarded as responsible for the provision of accommodation to the worker, and
•    the accommodation is suitable to be considered “living accommodation”.
When both these conditions are satisfied National Minimum Wage pay should be calculated using the accommodation offset unless the accommodation is provided by a council or social housing provider when special provisions apply in certain circumstances.
The calculation will differ depending on whether the employer provides living accommodation to the worker free of charge, or whether the employer charges the worker for the living accommodation. 
If the accommodation offset does not apply, any charge the employer makes for accommodation must be considered by applying the National Minimum Wage deduction and payment regulations in the normal way.
You can find out further information about the accommodation offset and the impact on NMW pay by visiting: National Minimum Wage and Living Wage: accommodation
Alternatively, if you require any further support, please seek independent legal advice, or contact The Advisory, Conciliation and Arbitration Service (ACAS) on 0300 123 1100.
Thank you.

So if NMW was £1,300 without accommodation and accommodation offset is £300, then NMW is £1,000 which is what goes through payroll

Hi,
Thank you for your query.
Without an ongoing review, we can only provide generic advice as a complete understanding of the full arrangements in place would be required to comment on specific situations. 
The accommodation offset is a notional amount that does not reflect market rates, which may count towards a worker’s pay for National Minimum Wage (NMW) purposes. The current accommodation offset rate is £9.99 per day, £69.93 per week, but this is set to increase in April 2025 to £10.66 per day, £74.62 per week.
If there is no charge, and the accommodation is free, including any additional charges that the employer would be entitled to receive with respect to the accommodation, then this offset rate is added to a worker’s pay.
If the total accommodation charge is at or below the offset rate, it does not affect a worker’s pay. 
If the accommodation charge is above this offset rate, the worker’s pay is reduced by the difference between the applicable offset and the accommodation charge.
There are further considerations and examples included in the Calculating the Minimum Wage guidance which you may find useful. For more information, please refer to: 
Living accommodation.
Alternatively, if you require any further support, please seek independent legal advice, or contact The Advisory, Conciliation and Arbitration Service (ACAS) on 0300 123 1100.
Thank you.