Home Office Tax Deductions in South Africa: Complete SARS Guide 2025

As the 2025 tax filing season (7 July to 20 October 2025 for non-provisional taxpayers) approaches, many South Africans working from home are exploring how to claim home office tax deductions. With remote work becoming increasingly common, understanding these deductions can help reduce your taxable income. This comprehensive guide, based on the latest SARS guidelines, outlines eligibility criteria, claimable expenses, calculation methods, and key considerations for the 2025 tax year (1 March 2024 – 28 February 2025).

Who Can Claim Home Office Deductions?

To qualify for home office tax deductions in South Africa, you must meet specific requirements set by the South African Revenue Service (SARS) under Section 23(b) of the Income Tax Act:

1. Employment Status: You must be an employee working from home. Self-employed individuals or sole proprietors may claim deductions under different rules related to their trade.
2. Dedicated Workspace: The home office must be a specific room or area used exclusively and regularly for your job duties. A shared space, like a dining table used for both work and personal activities, does not qualify.
3. Equipped for Work: The space must be specifically equipped for your trade, with items like a desk, computer, or other work-related equipment.

Additionally, your eligibility depends on your remuneration type:

• Salary-Based Employees: If your income is primarily salary, you must perform more than 50% of your work duties in your home office during the tax year.
• Commission-Based Employees: If more than 50% of your remuneration comes from commission or variable payments based on work performance, you must perform more than 50% of those duties outside an office provided by your employer.

These strict conditions ensure that only genuine home office setups qualify, reflecting the costs you wouldn't incur if working from an employer's office.

What Expenses Can You Claim?

SARS allows deductions for expenses directly related to maintaining and using your home office. These expenses fall into two categories:

Premises-Related Expenses (Apportioned)

These costs must be apportioned based on the home office's floor area relative to the total residence. Eligible expenses include:

• Rent (if you rent your home)
• Rates and taxes
• Electricity
• Cleaning services
• Repairs and maintenance (e.g., painting or fixing the office space)

Note: Mortgage interest is no longer deductible for home office expenses as of 2023, per the updated Interpretation Note 28 issued on 4 March 2022.

Equipment-Related Expenses (Claimed in Full)

Expenses for items used exclusively for work in the home office do not require apportionment and can be claimed in full, including:

• Wear and tear on office equipment (e.g., computers, printers)
• Wear and tear on office furniture (e.g., desks, chairs)
• Repairs to office equipment or furniture

These deductions are particularly valuable for employees who invest in home office setups to perform their duties effectively.

How to Calculate Your Home Office Deduction

SARS provides a clear formula for calculating home office deductions for premises-related expenses:

Deduction = (A ÷ B) × Total Costs

Where:

• A = The area in square meters (m²) of the home office, specifically equipped and used regularly and exclusively for work.
• B = The total area in square meters (m²) of the residence, including outbuildings and any area used for trade.
• Total Costs = Costs closely linked to the premises (e.g., rent, rates, taxes, electricity, repairs), excluding expenses of a capital nature (e.g., home renovations).

Example Calculation

Suppose your home office is 10 m², and your total residence is 100 m². Your annual premises-related costs (rent, electricity, rates, and repairs) total R12,000. The deduction would be:

Deduction = (10 ÷ 100) × 12,000 = R1,200

Additionally, if you spent R2,000 on wear and tear for a computer used exclusively for work, you can claim the full R2,000. Your total deduction would be R1,200 (premises) + R2,000 (equipment) = R3,200.

Expense Type	Example Costs	Apportionment	Deduction Example
Premises-Related	Rent, electricity, rates, repairs	Based on floor area	R1,200 (10% of R12,000)
Equipment-Related	Computer, desk wear and tear	Full amount	R2,000
Total Deduction			R3,200

Claiming on Your Tax Return

To claim home office expenses on your ITR12 tax return, follow these steps:

1. Access the "Other Deductions" Section: On your SARS eFiling account, locate the "Other Deductions" container in the ITR12 form.
2. Enter Source Code 4028: Input the calculated home office deduction amount next to source code 4028 (Home Office Expenses).
3. Answer the Form Wizard Question: When using the eFiling form wizard, answer "Yes" to the question: "Did you incur any expenditure in respect of a home office?" This ensures the home office expenses section is added to your return.

Ensure accuracy, as claiming home office deductions often triggers SARS audits. Keep detailed records to support your claim, including:

• A letter from your employer confirming you work from home, including dates, reasons, and whether an office is provided at their premises.
• A schedule of home office expenses with receipts or invoices.
• A calculation showing how you arrived at the deduction amount, including floor area measurements.

Capital Gains Tax (CGT) Implications

Using part of your home as a home office can impact Capital Gains Tax (CGT) when you sell your property. The portion used as a home office is considered "tainted" and does not qualify for the R2 million primary residence exclusion. When calculating CGT, you must:

1. Apportion the gain or loss based on the floor area used as a home office and the period it was used for work.
2. Apply the primary residence exclusion only to the untainted portion of the property.

For example, if your home office is 10% of your home's floor area and you used it for work for 5 years out of 10 years of ownership, 5% of the gain (10% area × 50% time) would be taxable, adjusted for the CGT inclusion rate (40% for individuals).

Common Mistakes to Avoid

To ensure a smooth claiming process and avoid SARS audits, steer clear of these pitfalls:

• Claiming Without Eligibility: Ensure your home office meets the exclusive and regular use criteria.
• Incorrect Apportionment: Accurately measure the floor area and exclude capital expenses from calculations.
• Lack of Documentation: Maintain records like employer letters and expense schedules, as SARS frequently requests these during audits.
• Claiming Mortgage Interest: Avoid including mortgage interest, as it's no longer deductible since 2023.

How Refund AI Can Help

At Refund AI, we simplify the process of claiming home office deductions with our AI-powered tax solutions. Our platform can help you calculate deductions accurately, organize supporting documents, and ensure compliance with SARS regulations. By leveraging AI, we save you time and reduce the risk of errors, helping you maximize your tax savings with confidence.

Conclusion

Claiming home office tax deductions in South Africa for 2025 can significantly reduce your taxable income, but it requires careful adherence to SARS guidelines. By ensuring your home office meets the eligibility criteria, accurately calculating deductions, and maintaining proper records, you can claim expenses confidently. Be mindful of CGT implications and avoid common mistakes to prevent audits. For personalized assistance, consider using AI-driven tools like those offered by Refund AI to streamline your tax filing process and optimize your deductions.

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Key Citations:

• SARS Home Office Expenses Guide
• SARS Individual Deductions FAQ
• SARS Claiming Home Office Expenses Media Release
• SARS How to Declare Home Office Expenses FAQ
• PwC South Africa Individual Deductions Summary
• TaxTim Deduction of Home Office Expenditure Blog
• Nedbank Working from Home Tax Deductions Guide