National Minimum Wage and Living Wage: accommodation

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1. Accommodation rates

Accommodation provided by an employer can be taken into account when calculating the National Minimum Wage or National Living Wage.

No other kind of company benefit (such as food, a car, childcare vouchers) counts towards the minimum wage.

Accommodation offset rates

The accommodation rates are set in April each year.

Year Daily accommodation offset rate Weekly accommodation offset rate
April 2025 (current rate) 拢10.66 拢74.62

Previous rates

Year Daily accommodation offset rate Weekly accommodation offset rate
2024 拢9.99 拢69.93
2023 拢9.10 拢63.70
2022 拢8.70 拢60.90
2021 拢8.36 拢58.52
2020 拢8.20 拢57.40
2019 拢7.55 拢52.85
2018 拢7 拢49
2017 拢6.40 拢44.80

Use the minimum wage calculator to check if it鈥檚 been paid.

Using the offset rate to work out the minimum wage

If an employer charges more than the offset rate, the difference is taken off the worker鈥檚 pay which counts for the National Minimum Wage or National Living Wage.

This means the higher the accommodation charge, the lower a worker鈥檚 pay when calculating the minimum wage.

If the accommodation charge is at or below the offset rate, it does not have an effect on the worker鈥檚 pay.

If the accommodation is free, the offset rate is added to the worker鈥檚 pay.

See examples of accommodation rates for minimum wage calculations.

2. What counts as accommodation charges

Include these costs as part of your overall accommodation charges:

  • rent
  • charges for things like gas, electricity, furniture
  • laundry

Working out if the employer provides the accommodation

The employer is providing accommodation if any of these apply:

  • the accommodation comes with the job
  • the employer (or a connected person or company) owns or rents the property the worker lives in, even if there鈥檚 no direct link between the job and the accommodation
  • the employer (or an owner, business partner, shareholder or director) gets a payment or benefit from the worker鈥檚 landlord or a member of the landlord鈥檚 family

Accommodation costs count towards the National Minimum Wage or National Living Wage, even if the worker does not have to use the accommodation to do the job. If the accommodation is optional, it only counts as a cost if the worker uses it.

Local housing authority and social housing providers

If someone working for a local housing authority or social housing provider gets accommodation from their work, this does not automatically count towards the National Minimum Wage or National Living Wage.

It only counts if the accommodation is linked to the employment. For example, a care warden who has to live on site has their accommodation linked to their job.

Higher or further education institutions

Accommodation is not counted when working out the National Minimum Wage or National Living Wage if it鈥檚 provided by a higher or further education institution to a worker who鈥檚 enrolled on a full-time course with the institution.

Help and advice

Call the Acas helpline if you have any questions about workers鈥� rights and the minimum wage.

3. Effect on the minimum wage

This effect of accommodation rates on the National Minimum Wage or National Living Wage depends on how much an employer charges for accommodation.

It鈥檚 calculated by 鈥榩ay period鈥�, the intervals at which someone is being paid. This can be weekly, monthly or in irregular intervals like every 10 days.

If the accommodation is free, it still affects the minimum wage. There is an offset rate of 拢10.66 per day for this.

It does not matter if the cost of the accommodation is taken from the worker鈥檚 wages beforehand or if the worker pays the cost after they get their wages.

Examples

Example 1: accommodation is free

John is 24 and gets 拢10.60 an hour. This is below the National Living Wage (which he should get as he鈥檚 over 23).

He works 30 hours a week.

He gets paid every 7 days (his pay period).

His employer provides free accommodation 7 days a week.

This brings John鈥檚 pay up to 拢13.09 an hour, which is above the National Living Wage of 拢12.21.

Calculation:

  1. 拢10.66 (offset rate used when accommodation is free) 脳 7 (days accommodation provided in pay period) = 拢74.62

  2. 拢74.62 + (拢10.60 脳 30 - the total pay in reference period) = 拢392.62

  3. 拢392.62 梅 30 (total hours in pay period) = 拢13.09

Example 2: accommodation is charged below the maximum rate

Lisa is 20 and gets 拢10.30 an hour. This is above the National Minimum Wage.

Her employer charges 拢6.50 per day for accommodation which is below the threshold of 拢10.66. No offset rate is applied.

The accommodation charge does not affect Lisa鈥檚 pay of 拢10.30 an hour.

Example 3: accommodation is charged above the maximum rate

Sam is 35 and gets 拢12.25 an hour. This is above the National Living Wage (which he should get as he鈥檚 over 21).

He works 40 hours a week.

He gets paid every 3 weeks (his pay period).

His employer charges 拢11.50 per day for accommodation.

Sam lives in the accommodation full time which is 21 days for his pay period.

This brings Sam鈥檚 pay down to 拢12.11 an hour, which is below the National Living Wage.

Calculation:

  1. 拢12.45 (hourly rate) 脳 120 (total hours in pay period) = 拢1,470

  2. 拢11.50 (accommodation rate) 脳 21 (days accommodation provided in pay period) = 拢241.50

  3. 拢10.66 (offset rate used when accommodation is free) 脳 21 (days accommodation provided in pay period) = 拢223.86

  4. 拢1,470 (total pay in pay period) 鈥� 拢241.50 (total accommodation cost in pay period) + 拢223.86 (total accommodation offset in pay period) = 拢1,452.36

  5. 拢1,452.36 梅 120 (total hours in pay period) = 拢12.11