South Africa News
SARS tax warning
The South African Revenue Service recently published an update on claiming home office expenses, warning taxpayers against applying the tax deduction without considering the full implications. Its advice on the issue comes after a full tax year where many employees were required to work from home.
SARS Commissioner Edward Kieswetter said that there are long-term implications of defining an area in your primary residence as a home office for tax purposes. It may be more prudent to wait and establish a more sustainable rhythm before making the decision,” Kieswetter said.
He also warned that SARS flagged many tax returns that included home office claims for verification. We really want to caution taxpayers to correctly and truthfully complete their returns, as [dishonest] behaviour will be detected,” said Kieswetter.
In its update regarding home office expenses, SARS warned that defining part of a primary residence as a home office will most likely negatively impact capital gains tax calculations in the future. Primary residences enjoy a R2 million exemption from capital gains tax, known as the primary residence exclusion.
However, the home office area is excluded from the R2 million exemption on a pro-rated basis. SARS said that taxpayers should weigh the potential costs of deducting home office expenses against the benefits.
“Taxpayers may also find that working from home led to savings on expenses they would otherwise have incurred, like transport, wear and tear on vehicles and so forth,” SARS stated. Taken together with the loss of part of the of the capital gains exclusion, these savings may outweigh the benefit of a claim for home office expenses,” it said.
SARS also warned that there was a high likelihood that a taxpayer who claimed home office expenses for the first time would be selected for verification or audit.
To find out if SARS is trying to scare taxpayers away from claiming the home office benefit, MyBroadband spoke to Andreana Osche of Anco Integrated Financial Services.
Osche said it was fair to make the taxpayer aware of the trade-offs of claiming home office expenses.
She also agreed with SARS that it is necessary to calculate whether the potential increase in capital gains tax is worth it.
However, Osche said that for most people, the impact to the capital gains on their primary residence from claiming home office expenses would be negligible.
Claiming home office expenses is not trivial, though, and does require diligence on the taxpayer’s part.
First, you must accurately measure your work area, then calculate the ratio of your work area compared to the total area of your home.
You can then deduct several expenses from your tax according to that ratio. Some examples of expenses you can deduct are:
Bond interest and insurance, or rentals
Utilities — electricity and water
Cleaning
Wages
Security
Osche said that the following costs might be deducted according to the percentages allowed by SARS, depending on whether the expense was incurred for business purposes:
Depreciation — the rate is determined by SARS, then claim 100% of that
Stationery — 100%
Repairs and maintenance, study assets — 100%
Assistant’s fees
Wi-Fi and computer expenses — usually 75% to 100%
Cellphone and telephone — usually 75% – 100%
Taxpayers must compile accurate schedules and provide all slips and vouchers if audited.
Importantly, Osche said that if the taxpayer is an employee, they must have a letter from their employer confirming that they will be required to work from home.
For your work area to qualify for home office deductions, the following should be noted:
An office, appropriately equipped, must have been set up at the place of primary residence.
You must have used the office regularly and exclusively for work purposes.
You must have used the office for more than 50% of your duties or, if you earn more than 50% of your remuneration from commission or other variable payments based on work performance, more than 50% of your duties must have been performed away from the employer’s office.
Any home office expenses must be linked to employment use and must be verifiable.
You must claim home office expenses against source code 4028 in the income tax return.
Source: News365
In other news – Bring back Somizi – Idols SA told
South Africans have taken to social media to express displeasure at the absence of Somizi Mhlongo on Idols SA season 17, episode 8.
On Sunday evening, Unathi and Randall Abrahams were the only judges on the show, including guest judge Lady Du. Learn more
The President of the Senate, Godswill Akpabio, has called for transparency, accountability and the elimination of unnecessary expenditures to cut down on the cost of governance in the country. Akpabio made the call on Monday at a one-day dialogue on the cost of governance in Nigeria organized by the National Institute for Legislative and Democratic Studies, NILDS, in Abuja.
Akpabio, who was represented by Sen. Agom Jarigbe (PDP-Rivers) highlighted the possible factors contributing to the high cost of governance in the country.He said the size of the country’s bureaucracy, the escalating public service wage bills, the overhead costs of appointed public officials, and the salaries and allowances of elected officials are major factors.
According to him, the running of government institutions among other substantial components contributed to weighing down the economy and hindering development efforts. Let us hold ourselves accountable and take responsibility for the betterment of our nation. We have to ensure that our government operates efficiently and effectively, serving the needs of the people and fostering sustainable development,” he said.
The president of the senate emphasized the need to streamline bureaucracy, eliminate unnecessary expenditures, and ensured transparency and accountability at all levels of governance. We must invest in our human capital, empowering our public officials with the necessary skills and knowledge to drive progress.
“And we must foster a culture of innovation and creativity, where new ideas can flourish and transform our nation,” he said.Akpabio urged all Nigerians to remain united, become agents of change and be committed to making sacrifices for the nation. He said that the 10th Assembly was ready to partner with all stakeholders to do everything within its constitutional powers to make Nigeria for all citizens.
Source: pmnewsnigeria
In other news – Bad leaders making the life of Nigerians miserable – Pastor Giwa
The senior pastor of Awaiting The Second Coming Of Christ Ministry, Adewale Giwa, on Sunday, lamented that the economic situation in Nigeria has gone from bad to worse under President Bola Tinubu.
The clergyman noted that bad leaders were intentionally making life miserable for Nigerians. Read more
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Manchester City 0-0 Arsenal. Manchester City and Arsenal handed Liverpool the advantage in the Premier League title race as they played out a bitterly disappointing goalless stalemate at Etihad Stadium.
Liverpool are now top of the table and two points clear of Arsenal after they came from behind to beat Brighton at Anfield, their delight increased by their two closest rivals cancelling each other out.
This was a game that made a nonsense of its billing as a potential classic, as Arsenal’s containing tactics snuffed out City while the Gunners had only limited chances of their own in a desperately poor affair.
Nathan Ake had an early close-range header saved by Arsenal keeper David Raya before going off injured while former City striker Gabriel Jesus posed an occasional threat, just failing to connect with Bukayo Saka’s cross inches from goal after the break.
Arsenal manager Mikel Arteta will be happier than City counterpart Pep Guardiola with this outcome – but the real winners were Jurgen Klopp and Liverpool.
Guardiola’s side were under greater pressure to win this match but their usual fluent passing game was rarely in evidence, stifled by the visitors’ organisation and infuriated by referee Anthony Taylor’s reluctance to punish the Gunners for a succession of infringements.
It led to a scrappy, disjointed game in which City were never allowed to gather their usual momentum and rhythm, with even the best efforts of master creators Kevin de Bruyne and Bernardo Silva unable to carve out meaningful opportunities for Erling Haaland, who was kept on the margins throughout.
The hosts held sway in possession for most of the second half but it was illustrative of the game that Raya barely had an anxious moment, his counterpart Stefan Ortega also idle for long periods.
Indeed, it is the first time City have failed to score at home in the Premier League since October 2021, a run of 47 games.
The reigning champions, as usual, will remain confident of retaining their title but Guardiola will be bitterly disappointed at his side’s failure to trouble Arsenal, with substitute Jack Grealish on the end of some lengthy post-match advice from his manager.
City are back here at Etihad Stadium to face in-form Aston Villa on Wednesday night knowing they cannot afford any more slip-ups in this tight Premier League title pursuit.
Arsenal arrived at Manchester City with a point to make and a chance to show their improvement at a ground where they have had a miserable record in the past.
The Gunners last won here in January 2015, drawing one and losing eight of their subsequent nine visits before this game.
Here, Arteta set his side out to be fiercely drilled and well-organised to frustrate, a strategy seemingly designed to earn the point they secured rather than risk more for victory.
It was a conservative approach but what it did demonstrate was that Arsenal do have more resilience and character than on previous occasions, when they have sometimes capitulated under City’s attacking assault.
Arteta’s side were composed but also willing to throw bodies on the line when danger threatened, not that they were ever in serious peril of conceding – a tribute to their display in itself.
They have kept clean sheets in both games against Manchester City this season, making them only the fourth team to shut out a Guardiola side twice in the same season.
Whether this is one point gained or two lost remains to be seen, but Arteta seemed satisfied enough at the final whistle.
source – BBC