I have a question:
A company is currently paying expenses on behalf of their employees.
They are medical expenses (dental, doctors, medicines, scan, etc).
The company is not a registered medical service provider.
What is the Vat implications on the payment of the medical bill using the following scenario as an example:
The employee goes to a doctor and the doctor charges R114 (incl. Vat).
The bill is send to the company for payment. The company pays the doctor R114.00
The company is Vat Registered.
1. Is the fringe benefit to the employee R114.00 or R100.00?
2. Because the employer is a registered Vat vendor, are they allowed to deduct the Vat from the employee (additional deduction screen on VIP will be created for this purpose)
It would be appreciated is you can substantiate your answers with reference to the Act(s).