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DH says: 24 February 2017 at 12:10 If I have a car allowance and on occasion I am required to use a rental for business travel after flying to a far destination, can my company add this fuel cost to my car allowance and withhold taxes on fuel used in the rental vehicle |
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TaxTim says: 27 February 2017 at 14:12 What source code do they use for the fuel on your payslip or IRP5? |
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DH says: 27 February 2017 at 14:28 Source Code 3701 - I have a fixed travel allowance and a Company Card that I am allowed to use for business fuel only and other expenses such as hotel bills and meals etc. The fuel spend is added to my allowance on source code 3701 and then tax deducted from my salary for the fuel spend IE if I fill up with R500.00 the R500.00 is added to my allowance and the nominal Tax on that will be deducted from my salary (Approx. R150.00 on R500.00) - If I have to fly to Cape Town and visit customers in that area, my company will rent a vehicle from Avis etc. - I then must use the same card to fill up / top up the rental vehicle - this amount has now for some or other reason also been added to Source Code 3701 and taxed as if I was using my own vehicle - I have asked our HR Department and the answer of its a fringe benefit or something was given - I do not understand as I do not know how I can claim back the tax on this business related travel legally from Tax via source code 3701 |
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TaxTim says: 28 February 2017 at 9:38 Do you use your fuel card for both business travel in town, as well as business travel out of town when you use a rental car? Do you use it locally for personal travel? |
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DH says: 28 February 2017 at 9:58 I use the Company Card for business fuel on my own vehicle, this can be near and long trips depending on where and when and whom I am required to visit customers for business purposes, and if applicable, for fuel for a company organized rented vehicle from an airport to customers premises etc. I fill up with my private Credit Card when using my vehicle for private use, to the office etc. |
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TaxTim says: 28 February 2017 at 10:28 You are correct in that if you use the fuel card for out of town business travel when using a rental car, you should not be taxed on it. This is pure business usage and therefore should not be taxed as a fringe benefit. It should not be treated in the same way as business fuel for your own vehicle - this is because you can claim against your travel allowance when you submit details of your business mileage of your personal vehicle when you submit your personal tax return. However, you won't be able to do this of course for the business mileage of the rental car. Your company probably includes all fuel expenditure on your company card together under one source code as it is easier to do this from an administrative perspective. However, we suggest you send them a breakdown of your expenditure each month which splits out fuel for your own car, and that for a rental car. You could request them to allocate the latter to another source code eg. 3714 (non-taxable allowance). |
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DH says: 28 February 2017 at 10:47 Thank you - much appreciated |
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TaxTim says: 28 February 2017 at 11:16 Only a pleasure! |
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