Did you know that you are able to claim expenses incurred in the production of your income?
Should your commission income exceed 50% of your total earnings, you will be allowed to deduct the following expenses:
Home Office Expenses
Allowed if: Employer doesn’t provide office space to work from & the room should be equipped specifically for the trade and used exclusively for business. If you comply with both, you can deduct expenses proportionately. Expenses like interest on the mortgage, rent, office equipment, domestic worker, repairs to the office. Please keep the measurements of the study and the size of the house for calculation purposes as well as ALL other expenses incurred to the home office.
Any computer equipment that was bought, may be depreciated and deducted. Any other computer consumables, worth less than R7,500 may be deducted. Like power cables, batteries, and memory attachments.
Deemed Private Expenses
Cellphone Expenses: 10% Deemed Private Expense – 90% Business Expense
Actual expenses incurred to generate the commission income. All proof must be retained i.e. clear copies of slips
Must be able to indicate:
- Who entertained and When?
- Nature of business intended to generate from the expense incurred
Examples of Entertainment: Food, Drink, Accommodation, Free Tickets or Vouchers, Gifts or goods for personal enjoyment.
In the case of no travel allowance, the following should be kept:
- Logbook documenting: Opening Km’s / Date / Purpose of Visit (client & where) / Closing Km’s / Km’s Travelled / Business or Private
At year-end, the business travel will be calculated and the following expenses will be allowed to deduct in proportion to the business travel:
- Repairs & Maintenance (Services + Tyre Replacement)
- Interest on Instalment
The expenses you are claiming can never exceed the amount of commission earned, expenses are limited to the commission amount earned.
It is very important to keep records of all your expenses, should SARS require an audit these documents will need to be provided.