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Commission earners and staying up to date on what you can claim and what portions

Posted 26 September 2013 under Tax Questions


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Hey TimI am back and this year I have subscribed to your service so I'm looking forward to easy filing!I do have a couple of questions, keeping it high level, as I earn the majority of my income on commission and spend quite a lot of my own income in making that possible. I'll just dive right in:A.) Can I claim depreciation on my 1.) Car and 2.) Scooter - how do I calculate that and where do I put that on my return if I can?B.) Can I claim insurance expenses on 1.) My Home Office and 2.) My Cellphone. While we are on the subject please spend a bit of time explaining what portions of cell expenses I can claim and if there are any limits?C.) Can I claim work lunches if they were not directly related to the production of income? I heard rumors this was a new thing. Is this true?Thanks so much for your help! One of the reasons I subscribed to your service was the access to a 24/7 helpdesk - if this is not the place to submit queries for the helpdesk, please point me in the right direction.Thanks and keep up the great work!Oliver

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TaxTimTaxTim says:
26 September 2013 at 22:49

Thanks for the compliments and returning to the site this year!

Before I answer all the questions do you work for one company who pays you in commission or are you seen to be an independent contractor working for various companies.

For Home office expenses - Can I deduct home office expenses? this is a really useful short decision tree to help you determine if you can deduct home office expenses.

Your travel costs for work purposes can be deducted, the best way of doing this is to deduct a per km amount based on the SARS official amount. This includes wear and tear and petrol and other travelling costs. The official rate for 2013 is R3.24 per km. Remember it must only be for business travelling expenses.

The cell phone is split into two parts, the handset and the costs of the service. The service costs would fall under telephone costs, and again only for business purposes. The handset would be depreciated based on the value - Cell phone Wear and Tear, remember to apportion for the business use though. Does your employer provide you with a cell phone and airtime, or is this your own device?

Lunches cannot be deducted as this is a personal expense, unless expended for business purposes only.


Oliver says:
27 September 2013 at 9:32

Hey Tim

Thanks so much for your reply and always the top quality help!

To follow up on a couple of points:

"do you work for one company who pays you in commission or are you seen to be an independent contractor working for various companies"
- I work for one company that pays me in commission

I did the Home Office Expense questionnaire, thank you. My question is should I gather together information on my insurance expenditure? Is this a claimable expense?

Travel - Great answer, thank you!

"Does your employer provide you with a cell phone and airtime, or is this your own device?"
- No, I pay for all cell phone expenses. At least half of my cellphone bill is work related. However, is there a maximum portion that I am allowed to claim? And,once again,is insurance here a claimable expense?

Thanks so much

All the best

Oliver


TaxTimTaxTim says:
29 September 2013 at 21:07

You would be able to claim the portion related to the use of calls, maximum would be business use, remember personal expenditure is never allowed as a deduction. As a commission earner you are entitled to more deductions, so you would be able to apportion the insurance based on the business use as well.

I hope that assists and thanks again for all the positive feedback!


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