- How to calculate the fringe benefits of VAT on company cars
- One of the most common fringe benefits encountered on modern payrolls is the right to use a company car
Where an employee has the right to use a company car, you must calculate the VAT on the fringe benefit as follows:
Where the vehicle is a motor car (not a bus or kombi) and the input tax was specifically denied, the calculation is as follows:
0.3% x the determined va... ››› more
- [15 February 2017]
- I deducted the tax on the fringe benefit, but now SARS is asking 'where's the Vat?'
- We recently received this question on the Accounting and Tax Club site.
Lucia, a business owner gave her employee and his family a weekend away to the Kruger as an employee incentive. She knew an incentive of this kind was a fringe benefit. And she dutifully calculated the tax and deducted it from her employee's payroll.
But when a SARS auditor came into her office for an unrelated Vat audit... ››› more
- [08 July 2015]
- Part 4: The fringe benefits you didn't know about and how to declare Vat on free or cheap services
- Dear Reader,
Most business owners don't consider declaring Vat on free or cheap services they give to their employees.
But, you should!
Because Vat Law says where you give a benefit or an advantage to your employee, it's seen as if you actually supplied, or sold, those goods or services. This is why you must calculate Vat on certain fringe benefits.
In the past weeks, I've... ››› more
- [05 December 2014]
- Part 3 - The seven fringe benefits you didn't know about and how to declare Vat on each: The purchase of an asset at less than actual value
- Dear reader,
If you've been reading my series on Vat on fringe benefits, you'll know you need to calculate and pay Vat on your employees' fringe benefits.
If you don't declare output tax on these seven fringe benefits, SARS will charge you penalties and interest all the way back to when you first made the mistake.
I've spoken about how to calculate Vat on the first two fringe benefits - ... ››› more
- [27 November 2014]
- The seven fringe benefits you didn't know about and how to declare Vat on each: Part 2 - goods/services you give your employees' relatives
- Did you know you have to pay Vat for goods or services you give your employees relatives?
Yes! If you give a benefit or an advantage to your employee, and that benefit is a supply of goods or services, it's seen as if you've actually supplied, or sold, those goods or services. The same applies to goods or services you give your employees' relatives. This is why you must calculate Vat.
Befo... ››› more
- [20 November 2014]