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Revealed: Three relocation expenses that are tax-free for your employee

by , 01 November 2013
Did you know that transfer costs are tax-free? That's right. If you transfer your employee, from Jo'burg, for example, so he can work for your Cape Town branch, any benefits he or his relatives get through the transfer is tax-free. Here are the three relocation expenses that are tax-free for your employee.

If you provide any benefit or advantage to a relative of an employee, the employee is deemed to have been granted a taxable benefit says the Practical Tax Loose Leaf Service.

BUT, this isn't always the case when it comes to relocation expenses.

Discover the three relocation expenses that are tax-free for your employee?

The Loose Leaf Service says that the following relocation expenses are tax-free:

#1: The cost you incur when you transport your employee, members of his household and their personal goods from his previous home to his new home.

#2: Costs incurred by your employee when selling his residence and settling into a new home. SARS will determine which of the costs will be tax-free.

#3: The cost you incur for hiring temporary residential accommodation in a hotel or elsewhere for your employee or members of his household. But this period must end 183 days after his transfer or after he took up his appointment, pending the obtaining of permanent residential accommodation.

Please note that relocation expenses are only tax free under the circumstances mentioned above.



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