The Impact of Refunds Made by Employees to Employers on the S10(1)(Q) Bursary Exemption

Talha Essop, Mahmood Surty () and Henriette Erasmus ()
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Talha Essop: University of the Witwatersrand
Mahmood Surty: University of the Witwatersrand
Henriette Erasmus: University of the Witwatersrand

A chapter in Embracing Technological Agility in Accounting and Business – Vol. 1, 2026, pp 15-28 from Springer

Abstract: Abstract This research paper investigates the impact of refunds made by employees to employers on the section 10(1)(q) bursary exemption of the Income Tax Act 58 of 1962 (ITA). The section 10(1)(q) bursary exemption is crucial for promoting educational access by offering an exemption for bursaries and scholarships. The ITA contains no provisions to allow for refunds made by employees to employers to be deducted when determining the remuneration proxy of the employee, potentially preventing employees from exempting bursaries provided to their relatives under section 10(1)(q). Sections 11(nA) and 11(nB) of the ITA allow for the deduction of such refunds from the taxable income of the employee. This mismatch undermines the legislative intent of fostering skills development and socio-economic growth through section 10(1)(q). This paper recommends amending section 10(1)(q) to allow for the deduction of refunds when calculating the remuneration proxy. The amended entails including a provision in section 10(1)(q) which allows for the deduction of refunds made in the prior year of assessment, or that made in current year of assessment should the employee not have been employed in a prior year of assessment, when calculating the remuneration proxy of an employee to ensure that it accurately reflects the employee’s net position.

Keywords: Refunds; Remuneration; Remuneration proxy; Bursary exemption; Section 10(1)(q) (search for similar items in EconPapers)
Date: 2026
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DOI: 10.1007/978-3-032-13380-9_2

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