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TAX claim
- Thread starter Calico
- Start date
LancelotSA
Banned
What is your occupation? Can you justify the use of a cell phone in the earning of your income? I claim my entire cell phone bill.
This is what the experts say :
That's quite interesting actually as another website also brings up the fact that most people forget to depreciate the cellphone. I know I do.
This is what the experts say :
That's quite interesting actually as another website also brings up the fact that most people forget to depreciate the cellphone. I know I do.
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LancelotSA
Banned
I reckon you should be able to claim it all then. Another site (in reference to the taxability of a cell phone allowance, however, but I can't see why the same should not apply to "consultants" claiming cell phone expenses as a deductible expense) states the following :
I suppose in my case it's the other way round. Most of my calls are private and business use is purely incidental. If I went through my bills I may be surprised at how much I really do use it for business, but that is what I am trying to avoid. BTW I don't get a cell phone allowance. My phone is totally my own responsibility.
LancelotSA
Banned
Off the record..... it really boils down to them being able to prove that any calls made were private and not business.... if this can be easily done then perhaps play it safe. If it can't, then claim it all.
In my business most of my friends are clients, or prospective clients, so even calls to them could well have been business calls.
In my business most of my friends are clients, or prospective clients, so even calls to them could well have been business calls.
Do you work for a company or yourself?
Do you earn a salary or commission?
Do you receive a cellphone allowance or can you claim back specific cell phone costs incurred?
It is not exactly the same. The one is a reimbursive cell phone allowance where effectively the employer is reimbursing you for calls made on behalf of the company. The assumption is that the allowance realistically reflects the actual costs, therefor you don't get taxed on the allowance and then have to deduct actual calls made.
To claim under s11(a) - the general deduction formula - as a salary earner will be very difficult. If you earn commission it shouldn't be a problem.
If you phone often you should really get an allowance - or even just structure your salary to allow for a cell phone allowance portion.
I earn a salary and commission. Complicated! Officially I am employed by one company. They outsource the sales to another company who pays my commission. Neither one pays me a cell phone allowance and I don't claim back on calls.
LancelotSA
Banned
You are right if he is salaried it is different. I, perhaps incorrectly, made the assumption from the information provided that the OP is operating his consulting business as a CC, sole prop or company.
LancelotSA
Banned
Is more than 50% of your income from commission? If so then SARS will allow expenses to be claimed as a deduction.
No, it's less than 50%.
I assumed the same, but you know how it goes - the OP always omits the important details.
Hmmm...didn't know that. Can you make a pro rata deduction if less than 50%?
@Calico, time to structure an allowance - although if you hardly spend money on business calls there is no need to try to tap blood from a stone.
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LancelotSA
Banned
Have a read through this interesting article
http://www.moneywebtax.co.za/moneywebtax/view/moneywebtax/en/page259?oid=35491&sn=Detail
Interesting! Shows you the importance of structuring and being aware of the little things - the 50% rule can have a huge effect on your taxable income.
When relevant you should monitor it through the year, maybe take deferred salary at tax year-end to correct any imbalance.
