SARS recently published the prescribed rate per-kilometer and the Cost Scale table under sections 8(1)(b)(ii) and (iii), effective 1 March 2025.

To access the publication, click here.

It is extremely important to note that the prescribed rate has decreased from R4.84 to R4.76. If your company reimburses at or below the SARS rate, ensure you make the necessary adjustments to your payroll before processing for March. If you leave the reimbursive rate at R4.84, this will be above the SARS rate and employees will be taxed on payroll on the value that exceeds R4.76.

This will also report the reimbursive travel on IRP5 code 3702 which is treated the same as a travel allowance on assessment. The full value reported on IRP5 code 3702 is taxed on assessment and will require employees to submit a logbook in order to claim a reduction in tax.

This change could therefor have negative tax implications for employees if not administered correctly and timeously on the payroll.