asked the Chancellor of the Exchequer what study he has made of the implications for tax on the benefits of a person occupying a company-owned property following the recent rating revaluation in Scotland; and if he will make a statement.
Where a person receives accommodation provided by reason of employment the tax charge on the benefit can in certain circumstances be based on the property's annual value. To avoid individual valuations, the Inland Revenue has in practice accepted that a property's gross ratable value may be taken as its annual value for tax purposes. The recent rating revaluation in Scotland will, however, mean that gross rateable values in Scotland will be considerably higher than those in England and Wales or Northern Ireland for equivalent properties.To avoid unfairness as between taxpayers in different countries of the United Kingdom, the Inland Revenue has decided not to follow the practice of assessing the benefit arising on property in Scotland in strict accordance with the recent rating revaluation figures while the future of rating revaluations is under consideration. Instead, the Inland Revenue will for the time being use figures which will produce broadly the same overall total tax burden for employees in Scotland as the 1978 figures. A statement of practice outlining the procedure to be adopted by the Inland Revenue will be issued in due course.