The tax benefits of owning a property

The tax benefits of owning a property

Owning a property comes with a lot of ongoing costs. Fortunately for investors, there are some expenses that can be deducted to minimise their tax obligations. By deducting operating expenses on your tax return, they can boost their tax refund and put more rental income in their pocket. They may claim from SARS if the property falls in any of the below categories.

• holiday homes
• bed-and-breakfast establishments
• guesthouses
• sub-renting part of your house e.g. a room or a garden flat
• dwelling houses and
• other similar residential dwellings.

If the property meets the below requirements, the owner or landlord qualifies for a tax deduction:

• rates and taxes
• bond interest
• advertisements
• collection fees of estate agents managing the property
• insurance (only homeowners not household contents)
• garden services
• repairs in respect of the area let and
• security and property levies

Whether they already own a second home or are looking at property for sale, investors staying on top of their property tax deductions can earn extra hundreds or even thousands of rands of saved tax