I was informed by SARS that a person earning Commission only cannot claim their travel expenses using SARS Fixed;Fuel;Repairs cost per kilometre. According to them the person can only base this deduction on their actual expenses of their own vehicle for t
Important:
This answer is based on tax law for the year ending 28 February 2020.
Answer:
For purposes of the guidance that follows we accept that the individual derived income (by way of commission only) and that section 23(m) of the Income Tax Act doesn’t apply. That also implies that the individual then didn’t receive a travel allowance.
With regard to business travel, the deduction must be based on the actual cost, which would include expenditure on fuel, insurance, finance, maintenance and wear and tear (in other words, under section 11(a), 11(e), 11(d) and 24J where applicable). The total must then also be adjusted for private use (based on the logbook) – under section 23(a) or (g).
We are not sure what ‘formula’ you are referring to. The individual doesn’t have an option to do it otherwise. You may be referring to the reduction of the allowance that can then be made by applying the rate per kilometre (fixed by notice in the Gazette) to the business travel evidenced by the log book – i.e. in terms of section 8(1) of the Income Tax Act. But, as we indicated it is not available where there is no allowance.