Josh Duhamel's remuneration does not include commission. He enjoys four fringe benefits as part of his salary package. These fringe benefits are An entertainment allowance A travel allowance, A low interest loan, A residential accommodation, and Certain telephone benefits Entertainment Allowance An entertainment allowance of R1 000 is awarded to Josh Duhamel each month by Fast

Residential Accommodation

Josh Duhamel enjoys free use of a four-bedroomed house purchased by Fast &

Furious (Pty) Limited for R1 960 000 for himself and his family. All water and electricity

costs are settled by the employer in full. These costs were R43 200 for the 2022 year

of assessment. Fast & Furious also spent R124 000 on appliance and furniture for the

house.

Josh Duhamel enjoys a "once-off" allowance of R30 000 on 01 March 2021 from his

employer to enable him to purchase certain additional "soft furnings" (curtaining and

linen) for this house. These items are his property.

Josh Duhamel's remuneration proxy is R540 000.

Telephone Benefits

Fast & Furious (Pty) Limited settles his monthly home telephone account. During the

2022 year of assessment it paid R18 600 (incurred evenly over the year). He has

estimated that 60% of his home telephone account is for business purposes.

Josh Duhamel also has free use of a cellular phone owned by Fast & Furious (Pty)

Limited. Rental and call expenses incurred by it during the 2022 year of assessment

were R14 400. These expenses were incurred evenly throughout the year. Although he

uses the cell phone for private purposes, it does not charge him for private calls, since

his private use of this cellular phone is incidental to business use.

REQUIRED:

1.1 You are required to discuss, with supporting calculations the taxable

portion of the above fringe benefits to be included in Josh Duhamel's

taxable income.

Use the following subheadings and mark scheme as a guideline:

o Entertainment allowance (5)

o Travel allowance (18)

o Residential accommodation (7)

o Telephone benefits (5)