Betty Bookkeeper explains how someone is taxed on subsistence allowances – September 2016

Hi Betty 

Can you explain how a person is taxed on subsistence allowances?

Scenario 1:

A guy pays from his own pocket for food, accommodation, drinks etc. The company the reimburses him.

Scenario 2:

He claims back from the company for food, accommodation drinks etc. – as well as unforeseen expenses.

How will he be taxed? Is a portion of this tax-free?


Hi Petrus

Where an employee is reimbursed for actual expenses incurred, this reimbursement will be tax-free in his hands. Also, an employer may pay an employee a tax-free subsistence allowance for deemed costs, where he is obliged to spend one night away from his usual residence in SA on business. This daily allowance is currently limited to the following amounts for the year ended 28 February 2012:

  • R 93 per day for incidental costs
  • R 303 per day for meals and incidental costs

Where an employee travels overseas, he may receive actual accommodation costs plus a daily allowance per country. The relevant allowance per country can be found on

Hope that helps!

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