December 1, 2023 | by SASSA Admin
Are you an employee who frequently travels for work? If so, it’s important to understand the SARS Subsistence Allowance Rates applicable to both local and international expenses. These rates have a direct impact on your employee subsistence allowance, tax deductions, and reimbursement rates.
For local expenses, the rates have remained the same for several years. Accommodation costs are set at R161 per day or part of a day, while meal and incidental costs are capped at R522 per day. If you spend a part of a day away from your usual place of work or employment, you can be reimbursed for meals and other incidental costs, as long as the reimbursement does not exceed R161. These rates apply within the Republic of South Africa.
On the other hand, foreign expenses vary by country. The exact rates are published annually in the Government Gazette and deemed to have been expended for each day or part of a day you are absent from your usual place of residence. It’s crucial to check the specific rates applicable to the country where your accommodation is located.
It’s important to note that the subsistence allowance is intended for abnormal circumstances and should not be part of your regular remuneration package. The rates provided here are for guidance purposes only, and it’s essential to verify the current rates in the Government Gazette each year.
The local subsistence allowance rates for employees required to spend at least one night away from their usual place of residence on business have remained unchanged for the past few years. These rates are set by the South African Revenue Service (SARS) and apply to expenses within the Republic of South Africa.
For local expenses, the accommodation costs are set at R161 per day or part of a day. This includes the cost of staying in a hotel, guesthouse, or similar accommodation. It’s important to note that this rate is a maximum, and employees can choose more affordable accommodation if preferred.
In addition to accommodation costs, the subsistence allowance also covers meal and incidental costs. This is capped at R522 per day. Meal costs include breakfast, lunch, and dinner, as well as any snacks or refreshments. Incidental costs refer to any additional expenses incurred during the business trip, such as transport or communication charges.
Employees who are obliged to spend a part of a day away from their usual place of work or employment can be reimbursed for meals and incidental costs, as long as the reimbursement does not exceed R161 and they provide proof of expenditure. It’s important to keep receipts or other supporting documentation to substantiate any claims for reimbursement.
It’s worth noting that the subsistence allowance for meals and incidental costs is exempt from tax if the amount reimbursed or advanced does not exceed the daily rate of R161. This means that employees do not need to include it as part of their taxable income.
| Expenses | Allowance Rate |
|---|---|
| Accommodation | R161 per day or part of a day |
| Meal and Incidental Costs | R522 per day |
The SARS Subsistence Allowance Rates also apply to expenses incurred during business travel abroad. These rates are specifically designed to cover the cost of accommodation and other incidental expenses while employees are away from their usual place of residence. It is important to note that the rates for foreign expenses vary by country.
When employees are absent from their usual place of residence, SARS deems a specific amount to have been expended for each day or part of a day spent abroad. The exact rates for each country are published annually in the Government Gazette. It is crucial to check the specific rates applicable to the country where the accommodation is located to ensure accurate reimbursement and compliance with tax regulations.
To illustrate the variability of the foreign subsistence allowance rates, the table below provides an overview of some specific amounts per country for accommodation costs. Please note that this is not an exhaustive list and rates may change annually. Always refer to the Government Gazette for the most up-to-date rates.
| Country | Accommodation Costs (per day/part of a day) |
|---|---|
| United States | R |
| United Kingdom | R |
| Germany | R |
| China | R |
As seen above, the foreign subsistence allowance rates for accommodation costs vary by country. It is essential for employees and employers to be aware of these rates to ensure proper reimbursement and compliance with tax regulations. By staying informed and adhering to the published rates, individuals can effectively manage their foreign business travel expenses while remaining in line with SARS guidelines.
The SARS Subsistence Allowance Rates have certain exclusions and limitations that you need to be aware of when claiming your allowance. These limitations are in place to ensure that the allowance is used for its intended purpose and to prevent any misuse or abuse.
It is important to note that the rates provided for the subsistence allowance are for guidance purposes only. The exact rates applicable to your specific situation should be checked annually in the Government Gazette. Make sure to review the latest rates to ensure accurate reimbursement for your subsistence and incidental costs.
By understanding the exclusions and limitations of the SARS Subsistence Allowance Rates, you can ensure that you claim the allowance correctly and avoid any potential issues with SARS. Remember to keep all necessary documentation and receipts to support your claims and consult with a tax professional if you have any further questions or concerns.
| Exclusions | Limitations |
|---|---|
| Employer Borne Expenses | Abnormal Circumstances |
When it comes to travel expenses for business purposes, it’s important to understand the SARS Subsistence Allowance Rates. In addition to subsistence allowances, there are also travel allowance rates that you need to be aware of. These rates are applicable to employees who incur travel expenses while on business trips.
It’s crucial to note that any allowance or advance provided for business travel should be used solely for that purpose and not for private travel. Expenses incurred for private or domestic travel cannot be considered as actual business travel expenses.
When it comes to tax deductions, it’s important to keep track of your business travel expenses and claim the appropriate deductions on your personal income tax returns. The total travel allowance is subject to the deduction of employees’ tax, with 80% of the allowance being taxable.
By understanding the SARS Subsistence Allowance Rates and Travel Allowance Rates, you can ensure that you comply with the regulations and make the most of your business travel expenses while maintaining accurate records for tax purposes.
The SARS Subsistence Allowance Rates are the rates set by the South African Revenue Service (SARS) to determine the amount that can be reimbursed or advanced to employees for their subsistence and incidental costs when traveling for business purposes.
Yes, the SARS Subsistence Allowance Rates apply to both local and international expenses.
The local subsistence allowance rates have remained the same for several years. The accommodation costs are set at R161 per day or part of a day, and the meal and incidental costs are capped at R522 per day.
Yes, employees can be reimbursed for meals and incidental costs if they spend a part of a day away from their usual place of work or employment. However, the reimbursement amount should not exceed R161, and employees must provide proof of expenditure.
The foreign subsistence allowance rates vary by country and are published annually in the Government Gazette. Employees can find the exact rates applicable to the country where the accommodation is located by referring to the Gazette.
Employees are not eligible to claim the allowance if the employer has already borne the expenses directly. The subsistence allowance is intended for abnormal circumstances and cannot form part of an employee’s regular remuneration package. It is an additional amount paid by the employer to cover personal subsistence and incidental costs.
Yes, there are travel allowance rates for employees who incur travel expenses for business purposes. However, any allowance or advance given for business travel should only be used for that purpose and not for private travel. Expenses incurred for private or domestic travel are not considered as actual business travel expenses.
80% of the travel allowance is taxable and subject to deduction of employees’ tax.
Employees should keep track of their business travel expenses and claim the appropriate deduction on their personal income tax returns.
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