Travel allowance vs company car — 2026/27 SARS rules
A travel allowance is paid to an employee who uses their own vehicle for business. 80% of the allowance is subject to PAYE (or 20% if 80%+ of use is business). Reimbursive travel up to the SARS rate per km (R4.84 in 2025) is not taxable if the vehicle is not otherwise compensated.
Payroll Africa Editorial · SARS Payroll Compliance Team
The Payroll Africa editorial team is composed of registered tax practitioners, payroll administrators and BCEA specialists who maintain the SARS PAYE, UIF, SDL and ETI engines that power the platform. Every article is reviewed against the current SARS BRS and Basic Conditions of Employment Act before publication.
- SARS registered tax practitioners
- SAPA-affiliated payroll administrators
- BCEA and LRA compliance reviewers
Last updated 30 Sept 2026
Fixed travel allowance
Reported under source code 3701. 80% of the allowance is taxed monthly (20% if the employer confirms substantial business use).
Reimbursive travel
Reported under source code 3702 (below the deemed rate) or 3722 (above). The 2025 SARS deemed rate is R4.84 per business kilometre.
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