The role of fringe benefits on the tax planning of employees in Rustenburg's metropolitan area
Rustenburg is one of the smaller towns in South Africa that are experiencing the highest development rate due to an increased growth in economic activities. Furthermore, Rustenburg is also one of the fastest growing metropolitan areas in South Africa. The yearly metropolitan growth rate experienced in Rustenburg from the year 2007 to the year 2012 is 5.1%. The high metropolitan growth rate in Rustenburg is due to the economic influence of the three biggest platinum mines in South Africa. Job opportunities stemming from mining activities in the area attract individuals from various parts of South Africa as well as immigrants from Southern Africa. Given its enormous mineral resources, employers in Rustenburg are at the same time competing for human resources with employers in neighbouring established cities. Fringe benefits, especially when utilized in tax planning, can play an important role in attracting more employees to the town. Therefore, it is against this background that the study seeks to evaluate the role of fringe benefits on the tax planning of employees in Rustenburg's metropolitan area. Most employees underestimate the real value of fringe benefits. Although fringe benefits have a host of benefits, some employees still underestimate the real value thereof. Moreover, most taxpayers are generally not familiar with the complex system of taxation. For the purpose of this study, a mixed method research design was used in order to understand research problems. A self-administered questionnaire consisting of close ended questions in the form of a Likert scale as well as an interview was utilized as data collection instruments. The results established that indeed most employees greatly underestimate fringe benefits, in many cases it is due to the lack of knowledge of the complex system of taxation and how to take advantage of fringe benefits in their tax planning. The recommendations are that employers should go the extra mile to educate employees about tax planning and utilising fringe benefits in tax planning.