Home office expenses for full time employees during lockdown

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If you are a full time employee and working from home since March 2020, you might be able to claim home office expenses if you worked from home for 6 months during the 2021 tax year as a result of the pandemic.

The South African Revenue Service (SARS) has confirmed that employees that work from home under full time employment will be able to claim home office expenses if they

  1. Work from home for a period of 6 months

  2. Their duties are mainly performed at home

  3. The work area must be specifically equipped for work and be exclusively used for working from home. You cannot claim if you work from your dining room table!

Expenses that you will be able to claim are:

  • Interest on your bond (not the full mortgage) or part of your rental expense

  • Rates and Taxes

  • Water

  • Electricity

  • Stationery

  • Data costs

  • Wear and tear on office equipment

To calculate the deduction, you need to take the floorspace that is used for business divided over the total floor area i.e. 10 square meters of office space divided over 100 square metres for the total house. Sadly you cannot deduct all your home expenses.

It should be noted that if your employer reimbursed you for any of the expenses incurred, then you won’t be able to deduct the expense or the qualifying expense will be deducted with the amount reimbursed by the employer.

Annja suggests that taxpayers start collecting all this information and send this to Anlo as soon as possible so that they can ensure that all qualifying expenses are included in their 2021 tax return ( 1 March 2020 – 28 February 2021) that is due next year.

Supporting documents are not required to be sent to Anlo but should be kept safe if SARS requires supporting documentation to be sent as part of a tax review or audit. 

We will only require you to send a schedule with the qualifying expenses and the home office area as well as the total area. Please also remember to inform Anlo if you have been refunded or reimbursed for any expenses.

Usually home office expenses are not allowed as a deduction for full time employees unless they earn commission income or variable income/payments as part of their employment, but SARS acknowledges that employees have had to make sacrifices and they should receive a tax deduction in recognition of this.