SARS Draft Interpretation Notes On Fringe Benefits And Allowances

The South African Revenue Service ("SARS") recently published four draft Interpretation Notes dealing with the taxation of allowances and fringe benefits. These draft interpretation notes are as follows:

• Issue 3 of Interpretation Note No. 14 on allowances, advances and reimbursements;
• A draft Interpretation Note on the right of use of a motor vehicle;
• A draft Interpretation Note on long service awards; and
• A draft Interpretation Note on the use of employer-provided cellular phones or computer equipment and employer-funded telecommunications services.

Although these interpretation notes are not law, they do provide taxpayers with useful guidance as to the tax treatment of such benefits and allowances, and include examples illustrating the practical application thereof.  Some of the guidelines which may be useful to employers are highlighted below.