Fringe benefit tax calculator Malawi
Choose the benefit, enter what it costs and see the fringe benefit tax you owe as the employer.
Every employer except the government pays fringe benefit tax on benefits in kind given to employees, directors included.
How it's calculated
- Motor vehicle: the taxable value is 15% of the original cost each year.
- School fees: 50% of the cost if you pay the school directly, the whole amount if you pay the employee.
- Housing you own: 50% of the greater of the open market rent and 10% of salary (12% if furnished).
- Housing you rent: the greater of the rent you pay and 10% of salary (12% if furnished).
- Utilities, household items, travel and domestic services: the full cost.
- Fringe benefit tax is 30% of the taxable value.
An example
A car that cost MK 30,000,000 has a taxable value of MK 4,500,000 a year. The fringe benefit tax is MK 1,350,000, or MK 337,500 a quarter.
Frequently asked questions
When is fringe benefit tax paid?
Quarterly, within 14 days from the end of each quarter, at any MRA Domestic Taxes office.
Is a cheap loan to an employee a fringe benefit?
Yes, if you charge less than the commercial lending rate. The difference in interest is the benefit. Education loans, house loans and emergency advances for medical or funeral costs are not taxed.
What is the penalty for paying late?
An employer who fails to register, pays late or does not pay owes a penalty of 20% of the tax due on top of the tax.
Key terms
- Fringe benefit
- Any asset, service or benefit in kind an employer gives an employee that includes an element of personal benefit.
- Taxable value
- The part of the benefit's cost that fringe benefit tax is charged on.
Up-to-date official data
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