Employers
are being reminded to adjust their payrolls to reflect the revised tax measures
relating to uniform, laundry and rental allowances which took effect on August
1.
In a release, the Tax Administration Services Department (TASD) says with the changes announced last month, cash allowances paid to employees for uniform and laundry are to be taxed in full.
In instances where the uniform is provided by the organization for the employee, the full value of the uniform is to be treated as a taxable allowance on the employee.
However, employees entitled to relief in respect of uniform and laundry allowances, as set out under Appendix B, Regulation 12 of the Income Tax Act, will continue to receive it without the deduction of income tax.
For this category of employees the exemption limit remains at $5,739 for uniform allowance, and $3,395 for laundry allowance per annum.
The TASD says any amount in excess of the exemption is to be taxed.
The treatment of housing/rental allowance has also been revised.
Based on the measures, third party payments are now subject to income tax at 25%.
In a release, the Tax Administration Services Department (TASD) says with the changes announced last month, cash allowances paid to employees for uniform and laundry are to be taxed in full.
In instances where the uniform is provided by the organization for the employee, the full value of the uniform is to be treated as a taxable allowance on the employee.
However, employees entitled to relief in respect of uniform and laundry allowances, as set out under Appendix B, Regulation 12 of the Income Tax Act, will continue to receive it without the deduction of income tax.
For this category of employees the exemption limit remains at $5,739 for uniform allowance, and $3,395 for laundry allowance per annum.
The TASD says any amount in excess of the exemption is to be taxed.
The treatment of housing/rental allowance has also been revised.
Based on the measures, third party payments are now subject to income tax at 25%.
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