In our previous article, we covered some of the key deductions, including:
- Pension Fund contributions,
- Retirement Annuity contributions,
- Income Replacement Policy contributions,
- and Donations.
Today, we’ll explore the remaining expenses you can claim when submitting your personal tax return to SARS.
Let’s break it down step by step.
Travel Expenses: What You Need To Know
Travel Allowance
If you receive a travel allowance from your employer for business-related travel, you can claim deductions – but there’s a catch.
As of 1 March 2010, SARS requires you to keep a detailed logbook to support your claim.
Here’s what your logbook must include:
- Date of travel
- Destination
- Reason for travel
- Opening and closing kilometers
- Split between business and private kilometers
Important note: Travel between your home and office is considered private and cannot be claimed.
Example:
Let’s say you’re a sales rep who travels to meet clients. If you drive 10,000 km in a year, and 7,000 km are for business purposes, you can only claim the 7,000 km.
Without a logbook, SARS may reject your claim, so keep it accurate and up to date.
Medical and Disability Expenses
Medical expenses can be a significant deduction, especially if you or your dependents have specific needs.
1. Persons with a Disability
If you, your spouse, or your child has a disability, all medical expenses can be deducted. This includes:
- Doctor’s visits
- Prescription medication
- Medical aids
2. Persons Under 65 Years of Age
For those under 65, deductions are split into two categories:
Medical Scheme Contributions:
- You get a monthly tax credit of R216 for yourself and your first dependent.
- An additional R144 is available for each extra dependent.
Out-of-Pocket Medical Expenses:
- You can claim medical scheme contributions that exceed 4 times the tax credit.
- Any other out-of-pocket expenses above 7.5% of your taxable income can also be deducted.
3. Persons 65 Years and Older
If you’re 65 or older, SARS allows you to deduct all medical expenses. This is a great benefit for retirees managing ongoing health costs.
Home Office Expenses
Working from home? You might be able to claim home office expenses—but only if you meet specific criteria.
Who Can Claim?
- Sole proprietors can claim home office expenses if they use a dedicated space for business purposes.
- Employees can only claim if they earn commission and work from a location other than their employer’s office.
What Can You Deduct?
You can deduct costs like:
- Rent
- Utilities (electricity, water, internet)
- Repairs and maintenance
Conditions:
- The space must be used regularly and exclusively for work.
- It must be specifically fitted for business activities.
Example:
Imagine you’re a freelance graphic designer working from a home office. You use 10% of your home’s total space for work. If your monthly rent is R10,000, you can claim R1,000 as a home office expense.
FAQs About Tax Deductions
1. Can I claim travel expenses if I work remotely?
No. Travel between your home and office is considered private, even if you work remotely part-time.
2. What happens if I don’t have a logbook?
SARS may reject your travel allowance claim. It’s worth the effort to keep accurate records.
3. Are medical scheme fees fully deductible?
No. You get a tax credit for medical scheme contributions, but out-of-pocket expenses have specific limits.
4. Can I claim home office expenses if I’m a salaried employee?
Only if you earn commission and work outside your employer’s office.
Key Takeaways
- Travel expenses require a detailed logbook.
- Medical expenses vary based on age and disability status.
- Home office expenses are only deductible under specific conditions.
By understanding these deductions, you can maximize your tax return and reduce your taxable income.
Final Thoughts
Tax deductions don’t have to be complicated. With the right documentation and a clear understanding of SARS’s rules, you can make the most of your allowable expenses.
If you’re unsure about any claims, consider consulting a tax professional to ensure you’re compliant and maximizing your benefits.
