• Travel allowance for 2013/2014

    Posted on March 1, 2013 by PGH Chartered Accountants (S.A.) in Accounting news, Audit news, Tax guide for 2013/2014, Tax news, VAT News.

    Travelling allowance for 2013/2014

     Below please find relevant extracts from the recent South African tax budget speech for the 2013/2014 tax year in respect of the travel allowance.

    Rates per kilometre which may be used in determining the allowable deduction for business-travel, where no records of actual costs are kept are determined by using the following table.

     

    Value of the vehicle

    (including VAT)

    Fixed cost

    Fuel cost

    Maintenance

    cost

    R

    R per annum

    c per km

    c per km

    0   – 60 000 19 310

    81.4

    26.2

    60   001 – 120 000 38 333

    86.1

    29.5

    120   001 – 180 000 52 033

    90.8

    32.8

    180   001 – 240 000 65 667

    98.7

    39.4

    240   001 – 300 000 78 192

    113.6

    46.3

    300   001 – 360 000 90 668

    130.3

    54.4

    360   001 – 420 000 104 374

    134.7

    67.7

    420   001 – 480 000 118 078

    147.7

    70.5

    exceeding   480 000 118 078

    147.7

    70.5

     Note:

    80% of the travelling allowance must be included in the employee’s remuneration for the purposes of calculating PAYE. The percentage is reduced to 20% if the employer is satisfied that at least 80% of the use of the motor vehicle for the tax year will be for business purposes.

    No fuel cost may be claimed if the employee has not borne the full cost of fuel used in the vehicle and no maintenance cost may be claimed if the employee has not borne the full cost of maintaining the vehicle (e.g. if the vehicle is the subject of a maintenance plan).

    The fixed cost must be reduced on a pro-rata basis if the vehicle is used for business purposes for less than a full year.

    The actual distance travelled during a tax year and the distance travelled for business purposes substantiated by a log book are used to determine the costs which may be claimed against a travelling allowance.

    Alternatively:

    •  Where the distance travelled for business purposes does not exceed 8 000 kilometres per annum, no tax is payable on an allowance paid by an employer to an employee up to the rate of 324 cents per kilometre, regardless of the value of the vehicle.

     

    •  This alternative is not available if other compensation in the form of an allowance or reimbursement is received from the employer in respect of the vehicle.

     

    Please note that while every effort is made to ensure accuracy PGH Chartered Accountants (S.A.) & Auditors does not accept responsibility for any inaccuracies or errors contained herein.

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