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Tax exemption for Fifa World Cup items

Many employers bought FIFA World Cup items for their employees in support of “Football Friday”. In terms of current legislation, these items given to employees for free are deemed taxable fringe benefits in the hands of the employees.

During a press conference in Pretoria on 10 June 2010, SARS announced a proposed amendment to the taxation of fringe benefits: a de minimus exemption of R750 on all FIFA World Cup-related items. Once this amendment is passed, it will be effective for individual taxpayers for the 2011 year of assessment commencing 1 March 2010.

The exemption on FIFA World Cup items such as T-shirts, jerseys and match tickets acquired by employers for their employees will be as follows:

  • There will be a R750 exemption per employee for any 2010 FIFA World Cup-related clothing, other goods or match tickets purchased by the employer for the employee on or before 11 June 2010. Any amount exceeding R750 will be a taxable fringe benefit.
  • The exemption only applies to the year of assessment commencing 1 March 2010.

Since the main purpose of these gifts to employees was to keep staff happy, it can be argued that the expense is deductible in terms of Section 11(a) as it motivates employees and increase productivity.

For more information contact by David Badenhorst on tel. 021 915 6666 or e-mail