Scenario 1 – the Employer owns the e-tag / Gautrain Card and pays the bill
In the case the Employee should submit a monthly report of business vs private usage otherwise the entire amount will be taxed as a fringe benefit.
- Where there is private usage then the Employer should ensure that the value of the private usage is taxed as a fringe benefit (i.e. as a cheap / free service).
- Private usage includes home to “normal place of work” travel.
- Employer gets VAT back (if registered for VAT) as it’s a normal company expense.
Scenario 2 – the Employee owns the e-tag / Gautrain Card and pays the bill
In the case the Employee should submit a monthly claim detailing all business related e-toll / Gautrain expenses for reimbursement by the employer.
- If the reimbursed amount is processed through the payroll, then it should be treated as “re-imbursive travel” and should be reflected on the payslip / IRP5 as such.
- VAT cannot be claimed by the Employer as the Employee is not a VAT Vendor. In cases where the Employee is a VAT Vendor then claiming the VAT is permissible as per the normal VAT process.
If the Employer pays the bill on behalf of the Employee then this should also be seen as a “Payment of an Employees Debt” and taxed accordingly.