Tax Benefits You Should Take Note Of

This article is here to inform you that there is a light at the end of the tax tunnel. That light spells tax benefits. Yes, there are certain channels by which you can benefit from tax.  Start benefiting from your tax responsibilities by reading through the top 10 tax perks and tips.

Tax Benefit: Car Costs

If you want to determine the total cost of your car, especially an older or paid for car, it is advisory to use SARS’ deemed cost instead of the actual cost.

Tax Benefit: Company Car vs. Travel Allowance

Choosing between a company car and travel allowance is a personal decision that depends on your circumstances. Here is an easy guideline to help you make the best decision.

If you don’t travel that much then a company car is more tax efficient, but just remember that the car doesn’t belong to you when you leave the company. If you travel more than 27 000 km a year, a travel allowance would be more beneficial.

Tax Benefit: Car Calculations

If your salary includes a car allowance it is important to know the tax advantages associated with various car finance options. If you are on an installment sale agreement you can claim the finance charges as you incur them. The cash cost of the car can be depreciated over five years and the write-offs will be proportionate to your business mileage during that specific tax year.

If the car is on a lease contract you claim the business travel portion of the actual installments against the car allowance you have received. When doing your annual tax return and apportioning the cost of your car to business travel you can use actual costs or the costs set out in SARS’ table.

Tax Benefit: Cell Phones

If you receive a company cell phone benefit from your company the full amount will be taxed each month. However you can claim a tax deduction for the cost of business calls on your tax return.

Tax Benefit: Computer Allowance

There are some companies that offer employees a monthly allowance to help them purchase computers for home use. This amount is taxed the same as for a cash salary, but you can claim depreciation of one third of the cost in your tax return.

Tax Benefit: Occasional Services

Some companies provide their employees an occasional tax service up to the amount of R500 per year. This should then be utilised for the services of a tax consultant or financial advisor. You don’t get taxed on the benefit and your company gets a tax deduction for the cost.

Tax Benefit: Facilities at work

Facilities at work like a crèche and a gym are a perk at the workplace that escapes tax.

If you have any other queries regarding tax benefits contact Tax Relax, a professional and registered tax consultancy.

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