1. Assets Funded by Government Grants

If your business has received a government grant to acquire an asset, it’s important to note that you can no longer claim a wear-and-tear deduction on that asset. Assets funded by government grants aren’t eligible for tax depreciation, so this adjustment will affect how you calculate taxable income. Be sure to include this in your tax planning.

2. Lay-bys and Credit Agreements

There’s a new allowance available for companies offering lay-bys or credit-based sales. You can now claim an allowance for these types of transactions, but there’s a stipulation—the allowance must be reversed in the following tax year. This update is especially beneficial for businesses that frequently rely on credit agreements, though you’ll need to carefully manage records to stay compliant.

3. Learnership Agreements

Companies with learnership agreements signed before 1 April 2024 can claim additional tax deductions. SARS has also introduced a new question on the tax return forms to confirm the dates of these agreements. To claim the deductions, make sure you have all necessary documentation in order.

4. Renewable Energy Investment Deductions

For businesses considering sustainable energy investments, there’s a great new incentive: a 125% tax deduction for investments in renewable energy equipment, like solar panels. This is part of SARS’ push to promote greener business practices, offering significant tax savings while helping companies lower operational costs with clean energy solutions.

Stay Prepared

These changes are designed to help you maximize tax benefits while remaining compliant. From restrictions on assets funded by government grants to new incentives for renewable energy, these updates can have a meaningful impact on your company’s tax strategy in 2024.

Share this guide with fellow (Pty) Ltd owners so they can stay informed and take advantage of these tax changes too.