Company Car Fringe Benefit Calculator South Africa
See your company car's monthly taxable fringe benefit and exactly how much extra PAYE it costs you, with and without an employer-approved logbook, under SARS's 2026/2027 rules.
Your employer calculates a monthly fringe benefit of 3.5% of the vehicle's determined value (3.25% if a maintenance plan is included), and by default adds 80% of that to your income for PAYE. If your employer is satisfied you'll use the vehicle at least 80% for business, only 20% is included instead, cutting the extra tax substantially.
A company car isn't free: SARS treats the private use of an employer-owned vehicle as taxable income, and the exact rand impact on your payslip depends on your vehicle's value, whether a maintenance plan was included and which inclusion rate your employer applies. Enter your own numbers below to see the real extra PAYE, both with and without an employer-approved logbook.
🚗 Vehicle & Salary Details
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How to Use This Calculator
Enter your vehicle's determined value
The retail price your employer paid, including VAT, excluding finance charges, interest and insurance.
Say whether a maintenance plan was included
This sets the rate at 3.25% (with a maintenance plan) or 3.5% (without) of the determined value.
Enter your monthly gross salary and age group
Needed to calculate the extra PAYE the fringe benefit adds at your own marginal tax rate.
See your extra monthly PAYE, both ways
The calculator shows the extra PAYE if 80% of the benefit is included (the default) and if your employer approves the 20% rate instead.
See what a logbook could save you
The difference between the two scenarios shows the monthly and annual saving an employer-approved logbook could produce.
Why this fringe benefit needs a calculator, not just a fixed percentage
The 3.25%/3.5% rate itself is fixed, set by SARS regardless of your circumstances. What actually lands on your payslip isn't fixed at all: it depends on your own marginal tax rate, which bracket the added income pushes you into and which of two very different inclusion rates your employer applies. A R400,000 vehicle costs a low earner and a high earner completely different amounts in extra tax, even though the fringe benefit value itself is identical for both. This calculator does that personalised arithmetic for you, rather than leaving you to apply a flat percentage to a number that was never flat to begin with.
The two fringe benefit rates: 3.25% and 3.5%
Your employer calculates a monthly fringe benefit value as a percentage of the vehicle's determined value, its retail price including VAT, excluding finance charges, interest and insurance. The rate is 3.25% per month if a maintenance plan was included in the purchase price, or 3.5% per month if it wasn't. This value doesn't change as the car ages or depreciates; it's set once, at the time of purchase, and applied every month for as long as you have use of the vehicle.
80% or 20%: the inclusion rate that actually moves your payslip
Once the fringe benefit value is calculated, only a portion of it is added to your income for monthly PAYE purposes, and it matters a great deal which portion applies. By default, 80% of the fringe benefit counts towards your monthly remuneration. This drops to just 20% if your employer is satisfied, typically based on your logbook or an established travel pattern, that at least 80% of your use of the vehicle for the tax year will be for business purposes. This isn't a year-end adjustment; it's a decision your employer can make from the start of the tax year, and it changes your monthly PAYE deduction directly, not just what you might claim back later.
Worked example: a R400,000 vehicle without a maintenance plan
An employee earning R30,000 gross per month is given a company vehicle with a determined value of R400,000 and no maintenance plan, so the 3.5% rate applies.
| Item | No Logbook (80%) | Employer-Approved Logbook (20%) |
|---|---|---|
| Monthly fringe benefit value (R400,000 × 3.5%) | R 14,000 | |
| Included in PAYE remuneration | R 11,200 | R 2,800 |
| Extra monthly PAYE | R 3,375.75 | R 771.75 |
The fringe benefit value is identical either way, R14,000 a month, but the actual PAYE impact isn't close: R3,375.75 extra a month with the default 80% rate, versus R771.75 if the employer applies the 20% rate instead. The gap is larger than a simple 80%-versus-20% ratio would suggest, because R11,200 added to this employee's income pushes part of it into a higher tax bracket, while R2,800 mostly doesn't. Use the calculator above with your own vehicle value and salary to see your exact numbers.
What a logbook could actually save you
In the example above, an employer-approved logbook saves this employee R2,604 a month, R31,248 over a full year, purely from the inclusion-rate switch. That's not a refund claimed later; it's cash the employee never loses from their monthly take-home pay in the first place. The catch is that your employer has to be satisfied you'll genuinely meet the 80% business-use threshold before they'll apply the lower rate; this isn't something you can elect unilaterally, and getting it wrong exposes your employer to correcting the shortfall later. If your travel pattern changes partway through the year, for example a new role that suddenly involves far less driving between client sites, tell your payroll department, since the inclusion rate should track a genuine change in expected use, not stay fixed on an assumption made months earlier that no longer holds.
The separate year-end reduction most people miss
Even if your employer applies the 80% rate all year, a second, completely separate mechanism exists at tax return time. When you file your annual return, SARS allows you to reduce the actual taxable fringe benefit value itself, not just the inclusion rate, based on your real business-kilometre percentage for the full year, plus further reductions for licence, insurance, maintenance and fuel costs you personally paid. This calculator focuses on the monthly PAYE impact, since that's what shows up on your payslip every month; the year-end figure depends on your actual full-year logbook, which only you have. Our full guide to code 3802, linked above, covers how that annual reduction works.
Company car vs travel allowance vs reimbursive rate, briefly
A company car isn't the only way an employer can put you behind the wheel of a vehicle you use for work. A travel allowance follows a similar 80%/20% inclusion logic to what's shown here, but you own and finance the vehicle yourself, so your actual running costs and depreciation matter in a way they don't with a company car. A reimbursive rate, paid at or below SARS's prescribed rate per business kilometre, is largely tax-free but only ever compensates genuine business travel, never private use. Which arrangement actually costs you (or your employer) less depends on your own vehicle costs and travel pattern, not on the company car figures alone, so treat this as a starting comparison rather than a final answer.