SOURCE CODE DESCRIPTIONS IRP5 code 3702

Allowance codes

in the electronic file IRP5 code 3702 is used for: Reimbursive travel allowance (IT). This code is only applicable where:
· the reimbursement rate used by the employer EXCEEDS the prescribed rate (par 4 of the Fixing of Rate per Kilometre i.r.o. Motor Vehicles Regulation), and/or
· the employee receives any other form of compensation for travel and only in respect of that portion of the reimbursement that DOES NOT EXCEED the amount determined by multiplying the prescribed rate by the actual business kilometres travelled.
Example:
If the prescribed rate is R3.61/km and the employer reimbursed the employee at R 4.00/km for 12540 business km’s travelled during the 2019 year of assessment, the reimbursive travel allowance must be reflected as follows:
· 3702 R 45 269 [R3.61 x 12540 km’s = R 45 269]
· 3722 R 4 891 [(R4.00 – R3.61) x 12540 km’s = R 4891]
Note:
· Code 3752 MUST only be used for foreign service income.
· The prescribed maximum business kilometres for years of assessment prior to 2018 are 8000 km.
· The prescribed maximum business kilometres for the 2018 year of assessment are 12 000 km.
· No business kilometre limit is applicable from the 2019 year of assessment

The prescribed Length of IRP5 code 3702 in the electronic file is: N15

The abbreviations used within the description of the relevant codes mean:
• PAYE: Income is subject to the deduction of Employees’ Tax and will also be taxed when the income tax assessment for the employee is processed.
• IT: Income is not subject to the deduction of Employees’ Tax but will also be taxed when the income tax assessment for the employee is processed.
• Excl: Income is not subject to the deduction of Employees’ Tax and will also not be taxed when the Income Tax assessment for the employee is processed.
• Excl/PAYE: Depending on the circumstances described in the legislation, the income is either subject to both PAYE and Income Tax, or it is excluded from both PAYE and Income Tax