Today's Labour News

Moneyweb writes that many South Africans had to set up a home office when the country went into lockdown and now want to find out about the tax implications in respect of expenses they have been incurring.  

According to Joon Chong of Webber Wentzel, there are limited circumstances under the Income Tax Act that allow salaried employees to claim deductions for expenses incurred while providing a service to their employers.  An individual who earns remuneration from an employer can only claim home office expenses if their home office is equipped for and is “regularly and exclusively” used to work for the employer for which they earn remuneration.  At least 50% of their remuneration must be variable, such as commissions or bonuses.  If individuals have less than 50% of remuneration as variable payments, they can still claim home office expenses if they spend more than 50% of their working hours working from the home office.  Jean du Toit of Tax Consulting SA says employees who normally work at the premises of the employer will not qualify for the deductions during the lockdown.  Unless the lockdown is extended for more than six months, most employees will not be able to claim any of the home-office expenses allowed under the Income Tax Act, he explained.  In the short term it may be easier for employees who have to work from home during the lockdown to claim home office expenses from their employer on a “reimbursive basis” with supporting invoices.  Costs which can be claimed include fibre connectivity cost, cell phone costs, stationery, and computer equipment, if these have been incurred for use mainly in the employer’s business.

• Read the full original of the report in the above regard by Amanda Visser at Moneyweb

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