Lockdown forced most of us to start working from home - which, in a lot of cases, has become a semi-permanent arrangement.
Great news about this is that you can claim tax back for your home office expenses.
You can claim this deduction if you are required to work from home for more
than half your total working hours or for more than 6 months for the tax year started March 2020.
Step 1: You will need a letter from your employee that you are required to work from home, and the percentage of your time spent there; as well as a dedicated space in your home specifically set up for work, equipped with the tools and equipment needed to perform your duties.
Step 2: The expenses that can be claimed are a portion of rental payments, interest on your bond, levies, electricity, data, cleaning, repairs, wear and tear on equipment and other expenses related to your total household.
Step 3: Calculate the square meterage of your home office in relation to the total size of your home and apply this percentage to the calculated household costs to determine your deductible home office expenses.
Make sure to declare this deduction on your income tax return as it will not be auto-populated along with your other tax information like IRP5s and medical aid.
If you are a sole proprietor or freelancer, you automatically get to deduct your home office expenses from your income as a trade expense.
There can be significant tax savings and refunds due to claiming these deductions, so make sure it is being done right. Make sure the supporting paperwork is ready to be inspected once submitted as SARS is likely to double check the deduction being claimed.
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