Abstract

The travel allowance deduction under section 8(1)(b) of the Income Tax Act 58 of 1962 is technology-neutral on its face, and an electric vehicle (EV) is a ‘motor vehicle’ for purposes of the section. The right to claim the deduction therefore exists. The harder question is how the deduction is calculated, given that both the actual-cost method under section 8(1)(b)(ii) and the deemed-cost method under section 8(1)(b)(iii) were drafted with the internal combustion engine in mind. The deemed-cost Schedule published annually under the section embeds petrol pump prices in its fuel-cost component, and Interpretation Note 14 (Issue 5) makes no reference to EVs. This article argues that the deemed-cost method, applied to an EV, produces a material over-recovery of the taxpayer’s actual energy cost, and that the actual-cost method leaves EV taxpayers in an evidentiary vacuum. The article proposes targeted amendments to the Schedule and to SARS guidance to align the regime with the policy direction set by the Just Energy Transition Partnership and by section 12V.