Travel Allowance tax deductions 

A travel allowance, in terms of section 8(1)(b) of the Income Tax Act No 58 of 1962, is any advance granted or an allowance paid to an employee, by their employer, for the use of his or her private motor vehicle for the employer’s business purposes.

Any allowance or advance in respect of travelling expenses that has been spent on private travelling (this includes travelling between the employee’s place of residence and his/her place of employment, or any other travelling done for his or her private or domestic purposes), shall be deemed not to have been actually expended on travelling for business.

A travel expense deduction is granted on a travel allowance for business travel expenditure and can be determined in one of the following ways:

  1. Using actual figures, the taxpayer can provide actual business expenditure figures which are acceptable to the Commissioner and to do so, the taxpayer would have to keep a detailed record of all business expenditure; or
  2. Using actual business kilometres travelled and a deemed cost per kilometre.

In each of the above cases a logbook needs to be kept by the taxpayer for all business travel kilometres and expenditure.