Generally in the South African environment costs incurred to acquire capital assets are not deductible when incurred in terms of the general deductions formula.

The costs are deductible under a number of sections that allow taxpayers to deduct the

The costs are deductible under a number of sections that allow taxpayers to deduct the costs over the asset usage period. The legislation has special allowances for the following assets:

  • Small business corporations
  • Assets used in the process of general manufacturing
  • Assets used in the process of manufacturing, distribution of electricity including renewable energy and allowances in respect of energy efficiency savings
  • Tax allowances applicable to buildings ( and other permanent structures)
  • Tax allowances applicable to special zoning areas
  • Deduction in respect of airport and port assets
  • Allowances in relation to certain industrial policy projects
  • Special allowances in relation to research and development amongst other special allowances
Contact an expert Veli Ntombela

Head of Tax

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