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Use this tip to claim a tax deduction on every day office wear and tear

by , 25 January 2013
Every time you switch on your office air conditioner or activate your security system, you're shortening its lifespan. But you could be using it to create a great tax deduction too. This is thanks to SARS' wear and tear allowance. It's time your office starts using it...

As you know, your assets depreciate (lose value) over time. This means, whenever you buy an asset for your office your company actually suffers a financial loss. But you can claim a wear-and-tear allowance from SARS on office equipment like your alarm system, air conditioner, cash register, vending machine and much more to compensate for this loss of value.
 
Here's what you need to do to take advantage…
 
How to write off 20% to tax for your air conditioner every year using wear and tear allowances
 
SARS has created a list of acceptable wear and tear write-off periods for a whole range of different assets.
 
For example, SARS states that the write-off period for an alarm system is five years.
 
'This means that after five years, SARS accepts that your alarm system has depreciated by 100% and is worth R0. Which means that your alarm system depreciates by 20% per year, for five years. [Thanks to SARS' wear and tear allowance,] you can claim an allowance of 20% of the value of the alarm system, each year,' explains The Practical Tax Loose Leaf Service.
 
So what other office equipment can you claim a wear and tear allowance for?
 
SARS allows a write-off period of five years for items like:
  • Fitted carpets;
  • Heating equipment;
  • Kitchen equipment;
  • Sewing machines;
  • Personal computers; and
  • Photographic equipment.
 
This means, you can claim a 20% allowance on the value of these items a year for five years.
 
SARS allows a write-off period of three years for items like:
  • Water tanks;
  • Calculators;
  • Excavators; and
  • Television and advertising films.
 
A full list on SARS' wear and tear write-off periods for other equipment is available here. Make sure you check it out so you don't miss any tax deductions you could be claiming.

For more information on tax deductions sign-up to the Practical Tax Loose Leaf Service here...

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