The following Direction is made by the Comptroller of Income Tax using powers given to him under Article 56(2) of the GST Law 2007 (as amended).
Accommodation provided under contract to an employee
“In circumstances where an employee is contracted by an employer and the latter is required by the terms of the contract to provide, directly or indirectly, accommodation to the employee, any charge made to the employee for that accommodation, either directly or by deduction from pay, shall be relieved of a charge to GST if the supply of accommodation would otherwise fall to be excluded from zero-rating by virtue of GST Law 2007, Schedule 6, Item 1(3)."
GST treatment
The effect of this direction is that accommodation provided by an employer to their employees, directly or indirectly, shall not result in a charge to GST on a charge for that accommodation and shall be treated as if it were a zero rated supply.
Notes
From representations made by members of the farming and hotel trades the GST Team were made aware that in some circumstances in these industries accommodation provided as part of a contract of employment to seasonal workers would fall outside the zero rating for residential accommodation. Schedule 6 Item 1 to the GST Law 2007 zero rates the provision of such accommodation except where the let is for less than 3 months or where the tenant does not have security of tenure.
This Direction ensures that all charges for accommodation made to seasonal workers are treated in the same way and are relieved of a charge to GST.
Expiry date
This Direction shall have no expiry date.
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