At a glance - tax treatment of various transport benefits
| Nature |
Taxable/ Not taxable |
| 1 |
Fixed monthly allowance |
Taxable |
| 2 |
Expenses for discharging official duties - Reimbursements made |
Not taxable
See examples of this payment. |
| 3 |
Mileage on private cars - Reimbursements made |
Private mileage - Taxable
Mileage reimbursements on some trips are not taxable |
| 4 |
Working overtime - Allowance paid or reimbursement made |
Not taxable if conditions are met. |
| 5 |
Shuttle bus service between convenient meeting points and the employment location |
Not taxable
An administrative concession has been granted not to tax this benefit as it is difficult to assign a specific value of the benefit enjoyed by each employee. |
| 6 |
Taxi trip between home and office |
Not taxable if the employee is working overtime. All other cases are taxable.
For taxable cases, a value can be assigned to each employee since a taxi can only carry a maximum of four passengers. The employer can apply its own method to assign a value. |
| 7 |
Travel between home and airport (where airport is not the workplace) |
Reimbursements made in 2005 and subsequent years are not taxable.
Per-trip allowance for an actual trip made is not taxable from 2007 onwards. |
| 8 |
Travel between home and business venue if the travel is for business purposes |
Reimbursements made in 2005 and subsequent years are not taxable.
Per-trip allowance for an actual trip made is not taxable from 2007 onwards. |
| 9 |
Trips made by home-based employee between home and external business venues
(The home-based employee works from home most of the time) |
If the employer acknowledges an employee as working from home, the home can be considered as the office. Trips between home and external venues for business purposes are therefore considered as official trips. Reimbursements made for these trips are not taxable. |
Payment of expenses for discharging official duties
Q Are these payments taxable?
If transport expenses are incurred for discharging official duties, for example, travelling from office to meet a client, the reimbursements are not taxable.
Reimbursements made for travelling between home and external venues for business (e.g. external meeting place with clients, external venue for trainings, seminars, workshops, courses and retreats) are also not taxable.
With effect from the Year of Assessment 2008, per-trip allowance for actual trip made is not taxable.
Reimbursement on mileage for private cars
Q Are reimbursements on mileage for private cars taxable?
Reimbursements on private mileage is taxable.
Reimbursements on mileage incurred on the following trips are not taxable:
- Between office and external business meeting venues, e.g. client's office
- Between home and airport for the purpose of overseas business trips
- Between home and external business meeting venues
- Between home and office when working overtime
The rate of reimbursement for mileage depends on the company's policy. While there is no prescribed standard mileage rate, the reimbursements made by the company should be reasonable.
Transport allowance/ reimbursement for working overtime
Q Is transport allowance or reimbursement for the expenses incurred for working overtime taxable?
Overtime transport allowance and reimbursement paid to employees in 2005 and subsequent years are not taxable provided that:
- The allowance/ reimbursement is meant for working beyond official working hours (whether during weekdays, off days, weekends and public holidays) on an ad-hoc basis.
- The payment policy is generally available to all staff.
The payments are also not taxable if the policy applies only to staff at the lower level.