Deductions7 min read

Home Office Deduction — SARS Section 23(b) Explained

Everything you need to know about the home office deduction — who qualifies, how to calculate the floor area ratio, and which expenses count.

Published 1 April 2025

Who Can Claim the Home Office Deduction?

Three categories of taxpayers qualify: (1) Self-employed individuals carrying on a trade from home. (2) Commission earners who earn more than 50% of their total remuneration in commission and are not reimbursed by their employer. (3) Salaried employees whose employment contract specifically requires them to work from home and whose employer does not provide an office. Category 3 is the strictest — SARS regularly rejects claims from employees who choose to work from home but have office space available.

The Exclusive-Use Requirement

The room or area must be used 'regularly and exclusively' for work. A dining room table that doubles as a workspace does not qualify. A spare bedroom converted into a permanent office does qualify. The room does not need a separate entrance, but it must be clearly distinguishable as a workspace. SARS has the right to inspect your home to verify — though in practice this is rare.

Calculating the Floor Area Percentage

Measure the floor area of your dedicated office and divide by the total floor area of your home (including garages, passages, and bathrooms). Example: 12m² office ÷ 120m² home = 10%. Apply this percentage to your total qualifying expenses. If you work from a room in a security complex, use only your unit's floor area — not common areas.

Which Expenses Qualify?

Qualifying expenses include: rent (or bond interest — not capital repayments), property rates and taxes, home insurance, electricity and water, internet and phone costs, cleaning of the office area, repairs and maintenance to the office, and depreciation on office furniture and equipment. Note: bond repayments are NOT deductible — only the interest portion. Body corporate levies count as a qualifying expense for sectional title properties.

Records You Must Keep

Keep a floor plan showing the dedicated office area with dimensions. Retain all invoices, municipal accounts, insurance policies, and internet bills. If you use internet partly for personal use, apply a reasonable business-use percentage (commonly 50-80%). SARS can request these records for up to 5 years after assessment — keep originals or certified copies.

Common Mistakes That Trigger SARS Audits

Claiming for a shared space (e.g. family TV room). Over-estimating the floor area percentage. Salaried employees claiming without employment contract proof. Not apportioning shared expenses (internet, electricity). Claiming bond capital repayments instead of interest. Claiming when your employer provides adequate office space. If SARS disallows your claim, you'll owe the tax plus interest — and potentially a penalty if they consider it negligent.

Disclaimer: This article is based on the South African Income Tax Act and published SARS Interpretation Notes as at the 2024/2025 tax year. It is provided for informational purposes only and does not constitute professional tax advice. Tax legislation changes periodically — consult a registered tax practitioner for advice on your specific situation.

Deductions