New SARS Travel Allowance Taxation Rules
The South African Revenue Service (SARS) introduced some changes with effect from 1 March 2018 to how travel claims are taxed. Travel claims that exceed the prescribed rate (R 3.61/km) are now subject to monthly Employees Tax. Previously, travel claims were taxed on assessment. [caption id="attachment_323" align="aligncenter" width="640"] Synergy Focus on Travel Allowance - Click to Contact us.[/caption] Example 1: If an employee claims R3.61/km for 1 000 kilometers traveled for business purposes, the total claim amount receivable is R3 610. No Employees Tax is applicable, as the prescribed SARS rate was used. Example 2: An employee claims R5/km for 1 000 kilometers traveled. The difference between the prescribed SARS rate and the rate claimed is taxable (i.e. R 5.00 – R 3.61 = R 1.39). This means that R1…