A fringe benefit is the cash equivalent of taxable benefits that are given to employees by their employer. Fringe benefits are taxable, and can be challenging to calculate without the help of an accountant or tax expert.
Types of Fringe Benefits
Fringe benefits are calculated by professional accountants, and can be offered through a number of different ways. Some of the most common examples of fringe benefits include the following:
- Employee use of company owned vehicle.
- Medical aid contributions made by an employer.
- Holiday accommodation provided to employees.
- Long service and bravery awards.
- Employee use of business cell phones and computers.
- Low interest or interest-free loans.
- Subsistence allowances.
- Residential accommodation supplied by employer.
Tax on a fringe benefit is calculated by using a determined value of the benefit that is received. It is essential for employees to submit a tax return to ensure that the tax amounts that were paid are correctly calculated.
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