Let me get right to the chase.
Situation: My employer offered to pay for my rent, giving me a few options to consider, and I'm not sure of the tax implications for each.
Details: I live in Florida and work remotely from my apartment. My employer has two entities, one in US and a main one in UK (a UK permanent establishment).
The US entity is the one employing me under a W-2 and the UK entity is the one that would be paying for my apartment. They are generally open to doing any of the following (pending discussion):
- They pay for the apartment directly (but have my name on the lease)
- I pay for the apartment by they expense my rent
- They sign the lease and pay for the apartment
They're also open to other options if I have any suggestions.
- It is my understanding that fringe benefits such as rent payments are generally taxable as income. How does this work if the entity paying for my apartment is based in the UK and is paying taxes in the UK on those payments?
- Does the answer for above differ for any of the three options I listed?
- Is there another option beyond the three I listed that is beneficial for me, tax-wise, and that I could propose to my employer?
- Does the Lodging on Your Business Premises exclusion work in some cases, in particular if the employer rents the apartment as a Florida office?