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Here's why employee who get an advanced travel allowances need to keep logbooks

by , 10 September 2014
There are two types of travel allowances: A reimbursive one, where you pay employees back for expenses and an advance one where the allowance is part of his salary.

If you give your employees an advance travel allowance, it's vital that they keep an accurate logbook. This document plays an important role in how SARS treats the tax.

And that's not the only reason your employee needs to keep a one...

 

Your employee needs a logbook so SARS can see how much of his allowance he used

 
If your employee doesn't use his full travel allowance, the rest becomes part of his taxable income. This means SARS can charge the full tax rate on this money.
 
That's where his logbook comes in. It verifies how much of that allowance he used to stop employees from using the system to get a bit of extra tax-free income.
 
He must be very clear in his logbook about how much he spends on fuel, oil and maintenance costs each month to help verify how much of his travel allowance he used.
 
But there's another reason for his logbook...
 
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His logbook helps record how much private travel he did using his travel allowance
 
If your employee uses his travel allowance for any private travel, it becomes a taxable fringe benefit. Your employee must clearly record any personal travel so you can accurately withhold his fringe benefit tax on that money.
 
If he doesn't do this, SARS will charge him penalties because he didn't pay tax on this employee benefit.
 
That's why you need to check your employee's logbook regularly to ensure he's filling in these details correctly. It's an important part in ensuring neither of you has to pay SARS penalties.

PS. Find out how to save R26 983 by keeping an accurate logbook

 

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