7. Income Tax calculation on Assessment
Every employee who is paid a travel reimbursement, should keep a logbook of his business travel if the rate/km paid by the employer exceeds the Prescribed rate/km, resulting in a code 3702 on his tax certificate.
In fact, all employees that travel for business purposes should maintain a logbook irrespective of which of the three methods of business travel compensation the employer uses.
Employers should consider setting up standard spreadsheets for the employee’s weekly / monthly business travel claim form that contains at least the following fields that are required for the logbook:
• Date
• Number of business kilometers (total for the day)
• Reason for travel (name of the client / area / reason etc.).
This spreadsheet then doubles as the employee’s logbook at the end of the tax year, as well as being used by the employer to administer the travel reimbursement and management information.