I can't say with conviction that the rental payments and loan interest on the campsite and trailer are deductible business expenses. Only the interest on the loan would be deductible, not the loan payment itself. If the trailer was considered a business expense, you could depreciate it.
The only clear argument you could make for deducting the expenses would be that they are ordinary and necessary business expenses. They do appear to be necessary and if other companies in the area typically provide similar lodging you could argue that they are ordinary.
Also, the benefit provided the employees of free housing would likely be taxable to them. In general, to not be taxable to the employee, the housing must be on the business premises, be offered for the convenience of the employer and provided as a condition of employment. You would not seem to qualify based on the letter of the law since the trailer is located in a camp that is not on your business premises. Also, the lodging is not there for your convenience, as it is not needed for the employee to live in the trailer in order to perform their job duties. I assume you would not require the employee to live in the trailer if they wanted to live elsewhere, so you would fail on that requirement as well.
This article from the Cornell Law School addresses the issue if you want to research it more.
[Edited 2/13/25 at 5:00 AM EST]
@markornet
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