Living accommodation is the only benefit in kind that can count towards minimum wage pay, and only up to a daily limit called the accommodation offset. Enter the pay period, hours, pay and accommodation charge to see the pay that counts, the hourly rate and whether it meets the minimum wage.
National Minimum Wage and National Living Wage
Most benefits in kind, such as meals, fuel or a car, don't count towards minimum wage pay. Living accommodation is the exception, but only up to the accommodation offset, a notional amount for each day that's set every April. GOV.UK is clear that it doesn't reflect market rents or what the accommodation costs the employer: it's there to stop employers clawing back the minimum wage through excessive accommodation charges.
What happens depends on what the worker pays for the accommodation:
| Accommodation | Effect on minimum wage pay |
|---|---|
| Free | The offset for each day is added to pay |
| Charged at or below the offset | No effect |
| Charged above the offset | The excess is taken off pay |
The charge includes rent and anything the worker has to pay as a condition of having the accommodation, such as gas, electricity, water, furniture or laundry. It makes no difference whether the employer deducts the charge from wages or the worker pays it after being paid.
From April 2026 the offset is £11.10 a day, or £77.70 for a full week. It's worked out for the whole pay reference period, the period someone is paid for, up to a calendar month: the number of days on which accommodation was provided for the whole day, times the daily rate.
| From April | Daily offset | Weekly offset |
|---|---|---|
| 2026 | £11.10 | £77.70 |
| 2025 | £10.66 | £74.62 |
| 2024 | £9.99 | £69.93 |
| 2023 | £9.10 | £63.70 |
| 2022 | £8.70 | £60.90 |
| 2021 | £8.36 | £58.52 |
The minimum wage itself is £12.71 an hour for workers aged 21 and over from April 2026, £10.85 for ages 18 to 20, and £8 for under 18s and for apprentices who are under 19 or in the first year of their apprenticeship. Rates change on 1 April, but a new rate applies from the first pay reference period that starts on or after the change. If a worker's pay period runs from the 16th of each month, the old rates apply until the period starting on 16 April. The calculator uses the rates in force on the first day of the pay period you enter, for periods from April 2024.
Free accommodation. John is 24, earns £10.60 an hour, works 30 hours a week and is paid weekly. His accommodation is free 7 days a week, so £11.10 × 7 = £77.70 is added to his £318 of pay. That's £395.70 for 30 hours, or £13.19 an hour, above the £12.71 National Living Wage.
A charge below the offset. Lisa is 20 and earns £11 an hour. Her employer charges £6.50 a day for accommodation, below the £11.10 offset, so the charge has no effect on her pay for minimum wage purposes.
A charge above the offset. Sam is 35, earns £12.90 an hour and is paid every three weeks for 120 hours, £1,548. He pays £12.50 a day for 21 days, £262.50, against an offset of £233.10. The £29.40 difference comes off his pay, leaving £1,518.60, or £12.65 an hour: below the National Living Wage. The calculator opens with Sam's figures. It shows he's £6.60 short for the period, and that a charge of up to £255.90 would have kept him at the minimum.
If a worker paid by the hour is absent, for sickness or holiday, but still paid for the missed hours, the accommodation charge is scaled down before the offset is applied. Multiply the charge by the hours actually worked, then divide by the hours the worker would have worked without the absence. Pay for the absence is left out of their minimum wage pay.
GOV.UK's example uses 2025/26 rates. A worker normally does 40 hours for £510 a week and pays £100 rent for 5 days' accommodation, against an offset of £53.30. In a week with two paid sick days they work 24 hours: the rent counts as £100 × 24 ÷ 40 = £60, and only £6.70 of it is above the offset. Their £306 pay for the hours worked, less £6.70, gives £12.47 an hour, above the £12.21 rate that applied. If the absence isn't paid, there's no adjustment, and the full £46.70 excess leaves them on £10.80 an hour. Tick the absence box in the calculator to apply the adjustment.
The rules apply whenever the employer provides living accommodation, even if living there is optional: if the worker takes it, the offset applies. The employer counts as providing it if the accommodation comes with the job, if the employer or a connected person or company owns or rents the property, or if the employer or someone in the business gets a payment or benefit from the worker's landlord. There are limited exceptions for some colleges, universities and 16 to 19 academies, local housing authorities and registered social landlords.
Check a worker's pay without accommodation using the minimum wage calculator, turn a salary into an hourly figure with the salary to hourly calculator, or see what apprentices must be paid with the apprenticeship wage calculator. For holiday pay on irregular hours, use the holiday pay calculator.
£11.10 a day, or £77.70 a week, from April 2026. It was £10.66 a day from April 2025.
If the accommodation is free, the offset for each day is added to the worker's pay for minimum wage purposes. If the worker is charged, only the part of the charge above the offset reduces their minimum wage pay. A charge at or below the offset has no effect.
Yes. Charges the worker has to pay as a condition of having the accommodation, such as gas, electricity, water, furniture or laundry, count as part of the accommodation charge.
Yes, but anything above the offset is taken off the worker's pay when checking the minimum wage, so a high charge can leave the worker below the legal minimum.
The rates change on 1 April, but the new rate applies from the first pay reference period that starts on or after that date.
Yes. If the worker chooses to take up the accommodation, the offset rules apply.
