New SARS Tax free rate per km

New SARS Tax free rate per km

• 08 March 2024
• Legal and Compliance
• South African Accounting Academy

The new tax free rate is R4,84 per km, and is effective for years of assessment commencing on or after 1 March 2024.

The gazetted income tax notice, relates to the fixing of rate per kilometre in respect of motor vehicles – section 8(1)(b)(ii) and (iii);, and sets out the following:

1. Definition
2. Determination of rate per kilometre
3. Cost scale
4. Simplified method (which represents the tax free rate)
5. Effective date

Click here to download the Gazetted notice:

https://www.gov.za/sites/default/files/gcis_document/202403/50243gon4456.pdf

Relevance to Auditors, Independent Reviewers & Accountants:

• The Income Tax Act is yet another piece of legislation that your clients must comply with, and which you must assess compliance with.  If they don’t comply with the relevant laws and regulations, you have certain reporting obligations in terms of NOCLAR (NOn-Compliance with Laws And Regulations) – this could include reporting to management, qualifying your audit opinion, reporting a Reportable Irregularity, etc.
• As an auditor, independent reviewer, an accountant or tax practitioner, you need to be aware of the proposed changes to tax legislation that is brought about by the annual budget speech.
• As an employer and taxpayer, you also need to comply with the Income Tax Act in your workplace.

Relevance to Your clients:

• An entity (company or close corporation) has a duty to comply with the Income Tax Act, and directors have to fulfil their duties accordingly, otherwise they could be held liable.
• It is important to be aware of the proposed changes to tax legislation that is brought about by the annual budget speech.

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