Answers · UK 2025/26
What is the accommodation offset for National Minimum Wage in the UK?
The accommodation offset lets an employer charge up to £11.10 a day (2026/27) for staff accommodation before it starts reducing the pay counted toward National Minimum Wage compliance -- charge more than that daily rate and the excess is deducted from an employee's minimum wage pay when checking compliance.
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When an employer provides living accommodation to a worker -- common in sectors such as hospitality, agriculture, and live-in care -- the value of that accommodation can be taken into account when calculating whether the worker is being paid at least the National Minimum Wage or National Living Wage. The accommodation offset is £11.10 a day for 2026/27 (equivalent to £77.70 a week), and it works as a two-way rule. If the employer charges the worker nothing, or charges an amount up to the £11.10 daily offset, there is no reduction to the pay counted for minimum wage purposes -- the worker's full gross pay is used when checking compliance. If the employer charges more than £11.10 a day for the accommodation, the excess above that daily rate is deducted from the worker's pay before checking it against the minimum wage, meaning the worker's effective hourly rate for compliance purposes is lower than their gross hourly rate suggests. For example, a worker paid £12.71 an hour (the 2026/27 National Living Wage) who is charged £20 a day for accommodation would have £8.90 a day deducted from their pay for compliance purposes (£20 minus the £11.10 offset), which could push their effective hourly rate below the legal minimum if their hours are low enough, putting the employer at risk of a minimum wage underpayment breach even though the headline hourly rate looks compliant. Crucially, this is the only benefit-in-kind that can be counted at all toward minimum wage pay -- other benefits such as meals, a company car, or health insurance cannot be used to offset an employer's minimum wage obligations, no matter how generous they are. Employers who fail to apply the accommodation offset correctly, or who charge excessive accommodation costs that push effective pay below the minimum wage, can face HMRC enforcement action, back-pay penalties, and public naming. Use the minimum wage calculator to check whether your pay, after any accommodation charges, meets the legal minimum.
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This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.