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In terms of para 2(d) of the Seventh Schedule, a fringe benefit will arise where residential accommodation is provided by an employer to an employee either for free or for a rental consideration which is less than the rental value of the accommodation, as determined under para 9 of the Seventh Schedule. This is an important benefit to consider for expatriate employees, as foreign nationals in South Africa as well as South African expatriates working abroad are generally provided with some form of company housing or housing assistance.

It should be noted that, from a tax technical perspective, the housing benefit dealt with under this section only applies to company-provided residential accommodation. This means that where the employer provides some other form of housing assistance, this section will not determine the application and the tax treatment must be determined in accordance with other applicable rules.

Paragraph 9 of the Seventh Schedule determines the cash equivalent of the fringe benefit created by para 2(d). There are different rules of valuation, depending on the circumstances. Generally, the cash equivalent