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Thinking of claiming input tax on business travel? Make sure you meet THIS condition first

by , 01 August 2014
Travel has become an integral part of business.

If your employees regularly travel for business, you'll know very well about how the high cost of air travel, car rental, accommodation and meals have added to the costs of doing business.

The good news is there's a way to try and recoup as many of these expenses as possible by claiming every legal input tax deduction available. Doing this will help you to ease your cash flow burdens.

But before you claim input tax on business travel, there's one condition you MUST meet...

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Here's the condition you must meet before you claim input tax on business travel

The condition for claiming input tax on business travel is: You (director), your business partner or your employee must have spent at least one night away from your usual residence and place of work for business purposes.
Only if the business travel meets this requirement can you recoup any of your business travel costs through the input tax claim.
To avoid any hassles with your claims for business travel, also make sure you collect all invoices and ensure they're 100% correct.
Remember what our experts always say: 'The most important link in the Vat chain is the tax invoice.'

If it's incorrect or incomplete, your input claim will collapse.

So insist on valid invoices from all your suppliers before payment! You can then claim input tax on tax invoices in the name of your business (with your Vat number if over R5 000) or in the name of your partner or employee because they're acting as your agent in acquiring goods and services for your business.
The bottom line: Before you even consider whether you can claim inputs on travel, make sure you meet this requirement first.

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