Car Scheme Options –
- Company Car – preferable
when business kilometres are less than 50% of the total kilometres
- Travel Allowance –
preferable when business kilometres are more than 50% of the total
Tax Treatment Methods
As a travel
allowance receiver, you have a choice of two methods of claiming a tax
deduction. With both methods, a log book must be kept with business travel
records for the year of assessment.
1. Actual Cost Method
When using the
‘actual cost’ calculation, a log book with
accurate details of all the actual costs of travelling must be kept.
Records must reflect fuel and running expenses, odometer readings, business
kilometres, and purpose of each of the business trips.
2. Gazetted Cost Method
With this method,
also known as ‘deemed cost’, you calculate your distances travelled for
business using the gazetted tables and applying rules and rates per kilometre
as set by the Minister of Finance. A deduction is claimed based on the annual
gazetted rates per kilometre in respect of fixed running costs depending on the
cost of the vehicle. Fixed costs also cover depreciation, interest, insurance,
licence and registration fees.
While every care
has been taken to ensure accuracy, Bidvest Bank cannot be held liable for
errors or omissions, nor any loss as a result of the use of any of the