Page 59 - Taxation F6 - Income From Employment

Fringe Income from Employment

• Discharge or payment of obligation

• A taxable benefit arises when the employer has released an employee from an obligation to pay a
debt or paid the debt on behalf of the employee to the third party.

• If it can be shown that the release was not to confer a benefit to the employee the release would

not be considered a tax benefit.

• Cash equivalent = amount paid by the employer or the amount owed by the employee.

• Payment of the employees RAF contributions.

• How about payment on behalf of the employee to the pension fund, UIF and skills development
fund?

• The following payments by the employer on behalf of the employee will have zero value.

- Employees subscriptions to professional bodies membership of which is the requirement of the

employees employment.

- Insurance premiums paid by the employer indemnifying an employee solely against claims arising
from negligent acts or omissions on the part of the employee in rendering services to the

employer.

- An obligation to the first employer arising from a non-compliance by the employee with the
conditions of a bursary or study loan granted to him by the first employer and which is settled by

the employees second employer. The benefit will have no value if the employee has undertaken to
work for the second employer at least for the unexpired period that has not been worked for the

first employer.
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