Travel Allowance and Tax in South Africa — How It Really Works
The SARS km rate, logbook requirements, and why your logbook is the most valuable document in your tax return.
SARS km rate (mid-range)
~R4.28/km
Logbook required?
Yes — always
PAYE assumption
80% private use
30,000km business
R128,400 claim
SARS Fixed Rate Per Kilometre 2025/2026 — By Vehicle Value
Vehicle Value (Cost)
Fixed Rate Per km
Up to R100,000
R3.98 / km
R100,001 – R200,000
R4.13 / km
R200,001 – R400,000
R4.28 / km
R400,001 – R600,000
R4.50 / km
R600,001 – R800,000
R4.72 / km
Above R800,000
R4.95 / km
Travel Allowance Tax Worked Example
Item
Detail
Amount
Monthly travel allowance received
R8,000 × 12
R96,000
PAYE taxed on (80% assumption)
R96,000 × 80%
R76,800 taxable
Business km driven (logbook)
28,000 km
Total km driven
38,000 km
Business use %
28,000 ÷ 38,000
73.7%
SARS rate (R400k vehicle)
28,000 × R4.28
R119,840 allowable
Deduction vs allowance received
R119,840 – R96,000
R23,840 additional deduction
Or: proportion of actual costs
73.7% × R85,000 actual costs
R62,645 allowable
Why Your Logbook Is Worth Thousands of Rand
The travel allowance is one of the few areas of the South African tax system where the outcome depends almost entirely on documentation. Two employees earning the same salary with the same R8,000/month travel allowance can have vastly different tax outcomes based purely on whether they keep a logbook.
Employee A keeps no logbook. At year-end, SARS assumes 100% private use. The full R96,000 allowance is taxable income. At a 31% marginal rate, that's R29,760 in tax on the allowance with no offset. Employee B keeps a careful logbook and proves 75% business use. They deduct R4.28 × 30,000km = R128,400 against the R96,000 received, creating a net deduction of R32,400. At 31%, that's a tax saving of approximately R10,000.
The difference between these two employees is a logbook app. Driversnote, MileIQ, and Google Maps can all assist with mileage tracking. SARS accepts electronic logbooks as long as they contain all required information.
Actual Costs vs Fixed Rate — Which Gives a Better Deduction?
You have two choices when calculating your travel deduction: the SARS fixed rate per km (easier, no receipts needed) or your actual costs proportioned by business use (more complex, requires receipts, potentially higher deduction for expensive vehicles).
For most South Africans driving a moderate vehicle (R200,000–R400,000 value), the fixed rate is simpler and often comparable to actual costs. For someone driving a luxury vehicle (R800,000+) where insurance, maintenance, and depreciation are very high, actual costs may produce a larger deduction. However, you must keep all receipts — fuel slips, service invoices, tyre receipts, insurance premiums — for the full tax year.
You cannot switch between methods from year to year based on which gives you a better outcome for that year. In practice, most people use the fixed rate because it's administratively easier and SARS-published rates are designed to approximate real vehicle costs for middle-of-the-range vehicles.
Frequently Asked Questions
A travel allowance is paid by your employer to cover business travel in your private vehicle. For PAYE, your employer taxes 80% of the allowance as income (assuming 80% private use) unless you have a logbook proving higher business use. At year-end, you claim the actual business km × SARS rate as a deduction on your ITR12, and the difference between what you received and what you legitimately spent is reconciled.
SARS publishes a fixed rate per kilometre in the annual income tax tables. For 2025/2026, the fixed rate for a vehicle with value between R200,000 and R400,000 is approximately R4.28 per kilometre. The rate varies by vehicle value. This rate covers fuel, wear and tear, oil, and other running costs.
Yes — absolutely. Without a logbook, SARS assumes 100% of your travel is private and you can claim no deduction. With a logbook, you deduct (business km ÷ total km) × actual costs, or use the fixed SARS rate per km. Either way, no logbook = no deduction. The logbook must record date, odometer start/end, destination, and business purpose of each trip.
A travel allowance is paid in cash into your salary — you use your own car and claim costs. A company car is owned or leased by your employer for your use. For tax, a company car triggers a taxable fringe benefit (typically 3.5% of the vehicle's determined value per month, unless you pay a portion). A travel allowance is generally more tax-efficient if you drive a modest, older vehicle that costs less than the SARS deemed rate.
No. SARS explicitly excludes commuting from home to your regular place of work as business travel. Only travel to clients, suppliers, other offices, or business-related venues qualifies. If you work from home and travel to your employer's office, that may also not qualify. Keep only legitimate business trips in your logbook.
Disclaimer: This page is for informational purposes only and does not constitute financial, tax, or legal advice. Always consult a qualified professional before making financial decisions.
