Sars
What you need to know about tax-free company transport
The provision gave rise to confusion, particularly in cases where employers did not provide the transport service directly
Getting to and from work can be a challenge for millions of South Africans, given the cost, risk and unpredictability of public transport. As a result, many companies offer transport services to their employees. While the Income Tax Act stipulates that any service paid for by an employer for the private or domestic use of an employee is deemed a taxable benefit, the SA Revenue Service (Sars), recognising the necessity of companies’ providing transport for their employees, made provision for this to attract “no value” for tax. However, the provision gave rise to confusion, particularly in cases where employers did not provide the transport service directly but contracted a third party to do so.
Now, after years of uncertainty, the revenue service has issued a binding general ruling that clarifies the tax law relating to this fringe benefit...
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