'Deductions and allowances – simple words with simple meanings. But, tax legislation has managed to give these simple words the most complex meaning and even greater consequences,' warns the Accounting & Tax Club.
To help you unravel the mystery, find out which two methods of advertising are not deductible.
Revealed: Two methods of advertising are not deductible
#1: Television and radio: According to the Practical Tax Loose Leaf Service, the production costs of an advertisement that'll you'll screen over a long period is of a capital nature and isn't deductible.
On the other hand, the costs may be deductible where the nature of the product only a few screenings made over a short period. In any event, the actual screening costs of such advertisements are deductible.
#2: Permanent structures: Advertising structures that create an enduring benefit or are of a permanent nature may be regarded as being of a capital nature.
For example, a lighting system in a display window that is of a permanent nature, permanent adverts on billboards as well as the erection of a model or a 'dummy' house for the display of goods at the show grounds. This model must be of a permanent nature.
Well there you have it. These two methods of advertising are not deductible. So make sure you comply with tax law.