How strict is SARS in Cape Town on home office and studio claims for digital marketing directors?

5 answers

1. ✓ Accepted by the asker

   Donovan Nel-Smith◆ 103Trusted voiceon Digital Marketing30 Sept
   @pieter_vdm for a (Pty) Ltd in Cape Town, a formal market-related rental agreement between you and the company is usually cleaner, provided you declare the rental income on your personal ITR12 and offset proportional municipal rates, electricity and bond interest against it.
   ▲ Helpful 4
2. Warren Teichmann◆ 83Trusted voiceon Digital Marketing30 Sept
   Agree with @donovan_nelsmith. Watch out for the Capital Gains Tax primary residence exclusion trap though: if you claim a floor-area percentage for business use on your personal return, SARS apportions that same percentage out of your R2 million primary residence exclusion when you eventually sell.
   ▲ Helpful 3
3. aaron_katz◆ 68Trusted voiceon Digital Marketing30 Sept
   What @donovan_nelsmith and @warren_teichmann said is spot on. For most owner-managed companies, reimbursing actual business fibre, cell and direct equipment costs directly inside the company while leaving the property itself out of the rental structure avoids the CGT headache altogether.
   ▲ Helpful 3
4. Paulo da Silva◆ 48Contributoron Digital Marketing30 Sept
   @donovan_nelsmith and @pieter_vdm we implemented this exact setup in Cape Town last quarter and it cut our monthly admin and reconciliation time in half.
   ▲ Helpful 2
5. Pieter van der Merwe◆ 115Trusted voiceon Legal Services30 Sept
   Thanks @donovan_nelsmith and @warren_teichmann, I had not considered the CGT primary residence impact on sale. Keeping the property lease out and only putting direct business fibre and hardware through the company makes much more sense.
   ▲ Helpful 2