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Are you claiming interest charges on an asset you haven't used yet? Don't!

by , 19 July 2017
Good news: You won't trigger CGT if you dispose of an asset in one of these ways...
Do these two things to guarantee your input tax claims?
Your employee just crashed the company car! Now what?

Dear reader,

Picture this... You buy property and start building an office. With two weeks to go to completion, you take out a loan and buy office equipment.

But you hit a snag.

The builders can't finish your offices for another three months. In the meantime, you're paying interest on equipment you're not even using yet.

So you claim the interest as a deduction from SARS. This way you can at least get something out of the delay.

But, if you do this, you'll be making the biggest mistake when it comes to claiming interest charges. 

Good news: You won't trigger CGT if you dispose of an asset in one of these ways...

Capital Gains Tax (CGT) is the tax you pay on the profits you make on the disposal (sale) of your assets.

The good news is, there are tax breaks and exclusions in South African tax law designed to give you tax relief and lower your CGT bill.

And if you dispose of an asset in one of these four ways, then there's no disposal for CGT.
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Eight ways to LEGALLY beat the taxman

There are a few Capital Gains Tax (CGT) loopholes that can save you thousands of rands every single year and, in some cases, let you off the CGT hook completely…

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Do these two things to guarantee your input tax claims?

Attention VAT vendors: It's your duty to charge output tax and claim input tax as long as you can prove your claims to SARS and back them up with all the required documents.

Get this wrong and SARS will deny your input tax claim and slap you with penalties and interest!

Since that's something that happens all too often in business these days, our experts suggest you do these two things to guarantee your input tax claims are a success.
 


Do you know the 14 forbidden items you can't claim input tax on?

SARS lists 14 supplies that are exempt from VAT. But many VAT vendors aren't sure:
  • What an exempt supply is;
  • Which supplies are exempt from VAT;
  • How to deal with VAT on exempt supplies;
  • If they can claim input tax when they make exempt supplies; and
  • How to deal with VAT when they make both taxable and exempt supplies.
We give you everything you need to know about exempt supplies in our Practical VAT Handbook.
 


Your employee just crashed the company car! Now what?

Every employer's worst nightmare: You give your employee the use of the company car and everything seems fine. He uses the car for his business.

But then, while he's on a business trip, he gives you a call. Your lovely company car is now a squashed ball of metal. 

So what do you do when one of your most expensive assets is now useless? Surely this is a massive loss for your company.

Not entirely.

SARS can help in situations like these. There's an allowance here that could turn that car write-off into a tax write-off too.

Click here to discover the tax allowance that lessens the loss of a crashed company car...
 


Confused about car and travel allowances? 

Get expert answers to the most frequently asked company car and travel allowance questions.

If you've ever turned to Google to get answers to your company car or travel allowance questions, you know there are thousands of pages to search through...

And how do you know if the answers you get are correct?!

That's why we've teamed up with leading tax experts to give you the expert company car and travel allowance answers you need.

Get your hands on them now when you claim your risk-free copy of the Practical Tax Handbook.
 


How you can avoid making this mistake
 
The truth is, you can't claim this deduction. Because you haven't used the equipment to produce income for your business yet.
 
The trick is knowing when you can claim the interest as a deduction. The practical Tax Handbook explains how. Claim your risk-free copy now.
 

Until next time,
 
David van Niekerk,
Editor in Chief: Tax Watch Newsletter
 
P.S. In the past 12 months, I've shown 1 200 small business owners, like yourself, how to knock up to R445 000 of their tax bill using these five simple tips. Don't miss out, find out more here...

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