The Home Office Deduction: Almost Everything You Were Told Is Claimable Is Not

Every February a version of the same list goes around: claim a slice of your bond interest, your rates, your electricity, your fibre, your phone, your stationery, your desk. Work out what percentage of your house the study is, apply it to everything, and hand the number to SARS.

Most of that list is wrong, and it is wrong for a reason that has nothing to do with how genuinely you work from home.

South Africa's home office rules run through two prohibitions in the Income Tax Act. Section 23(b) decides whether the room qualifies. Section 23(m) then decides which expenses survive, and for an ordinary salaried employee it deletes most of them. SARS set all of this out in Interpretation Note 28 (Issue 3), published on 4 March 2022. It is the document your claim will be measured against, and almost nobody writing about home offices seems to have read past its first page.

The room test comes first, and it is strict

Section 23(b) prohibits a deduction for expenses connected with any premises, except in respect of the part occupied for the purposes of trade. Employment counts as a trade, so employees are in principle eligible.

But proviso (a) adds two conditions, and SARS's note is blunt that both must be satisfied. The part must be specifically equipped for the purposes of the taxpayer's trade, and it must be regularly and exclusively used for those purposes.

"Specifically equipped" means fitted with the instruments, tools and equipment required to conduct that trade. For office-type work, SARS accepts that this would include a workstation and chair, a computer and communication equipment. A mechanic needs tools, an architect a drawing board, a doctor examination room equipment.

"Regularly" means frequently. A study used once on a weekend while you keep separate business premises is not regular use.

"Exclusively" is where most claims die, and IN 28 is unusually direct about it. There is no exclusion in section 23(b) for incidental private use. SARS's own examples make the standard visible:

• The dining table does not qualify. A computer services agent working from a laptop on the dining room table fails, because the room is also used for meals, games and puzzles.
• A dedicated room used by children on weekends does not qualify. A tax consultant's separate, specifically equipped, regularly used home office still failed the test because the children were allowed to play in it on winter afternoons and weekends.
• Two spouses sharing one home office both fail. Where a lecturer and a paralegal shared the same space and equipment, neither could claim, because the space was not exclusively used by either.
• Two spouses with divided space can both qualify. Where a lecturer and a tailor split one room into two distinct parts, each using only their own allocated and separately equipped part, both met the test.

SARS does allow that the law does not concern itself with trifles: answering a private call in the home office, or walking through it to the patio after work, will not break exclusivity. But a shared room, a corner of a lounge, or a study that doubles as a guest bedroom will.

Then the "mainly" test, which is about where you actually worked

If your trade is employment, section 23(b) adds a further hurdle, and which hurdle depends on how you are paid.

Commission earners must derive more than 50% of their income from commission or other variable payments based on work performance, and their duties must be performed mainly somewhere other than an office provided by the employer.

Everyone else — the salaried majority — must perform their duties mainly, meaning more than 50%, in the home office. SARS applies this over the full year of assessment, not month by month. Its Example 6 is a law researcher who worked from home on Mondays, Wednesdays and Fridays: 150 of 250 working days, 60%, so the test is met. Its Example 8 is a salaried employee working two days a week from home: 40%, so the test fails, even though the employment contract expressly permitted working from home.

Two things follow from that second example, and both matter.

First, permission is not proof. SARS's words: whether the employer permits or requires you to work from home "is not the test". The question is where you actually performed the duties.

Second, employer letters carry less weight than people assume. SARS says it cannot accept such a letter as absolute proof, because an employer is ordinarily only able to confirm that you were permitted to work away from its premises, and how many days you were present at the office if it kept those records. In Example 8 the employer's letter claiming 60% was simply factually wrong — the employee had spent the third day at a partner's dining room table.

Keep your own record. The burden of proof sits with you under section 102(1) of the Tax Administration Act.

Now section 23(m), which deletes most of the list

Suppose the room qualifies and you pass the mainly test. Here is where the popular checklists fall apart.

Section 23(m) applies to anyone deriving remuneration from employment or an office, unless they are an agent or representative whose remuneration is mainly commission based on sales or turnover. If it applies, it prohibits every deduction except the specific ones listed in section 23(m)(i) to (iv).

For home offices, what survives is a short list: the rent of, the cost of repairs of, and expenses in connection with the part of the premises used for trade — plus wear-and-tear allowances on non-permanent assets used for trade.

What that leaves in, per IN 28:

• rent, if you rent
• repairs to the home office itself
• rates and taxes, and other municipal service charges such as sewerage and refuse
• electricity
• homeowners insurance, to the extent it insures the premises against damage
• non-capital security costs
• cleaning costs
• wear and tear on office equipment and furniture

And what it takes out, which is the part worth reading twice:

Bond interest. SARS states that interest on most loans used to acquire a property meets the requirements of section 24J and is therefore deductible under 24J, not under section 11(a). Section 23(m)(iv) only preserves deductions allowed under section 11(a) or 11(d). So the interest is not preserved, and section 23(m) prohibits it. SARS's own parenthetical is that "in most cases interest will not be deductible". If you are a salaried employee, take the bond interest off your list.

Fibre and internet subscriptions. Monthly subscription fees are expenses in connection with a telecommunications service, not in connection with the premises. The service is provided in the premises but not in connection with it. Prohibited under section 23(m).

Phones, stationery, furniture as an expense, tea and coffee, computer equipment as an expense. Same reasoning. SARS's worked illustration: an employee buys stationery used specifically and exclusively for employment. It passes section 11(a) and is not denied by section 23(b) — and section 23(m) prohibits it anyway, because stationery is not "in connection with any dwelling house or domestic premises".

Bond insurance, which is normally a life product and separately prohibited by section 23(r), and household contents insurance, which relates to contents rather than the premises.

Capital items are the exception that proves the rule. A desk, a chair or a computer that qualifies for a wear-and-tear allowance under section 11(e) is expressly excluded from the section 23(m) prohibition, so the allowance is deductible. The equipment is claimable as an allowance over time; it is not claimable as an expense in the year you bought it.

Apportionment is by floor area, measured, not estimated

SARS accepts one method: apportionment based on floor area.

The denominator is the entire area of all buildings on the property, not just the main dwelling. In SARS's Example 9, a 16 m² home office in a 210 m² dwelling with an 18 m² double garage and 25 m² workers' quarters is apportioned as 16 / 253, not 16 / 210. On R135,000 of premises-related expenditure, that is R8,537. The erf size — 600 m² in the example — is irrelevant.

Two rules attached to that calculation are easy to miss:

• Estimates are not allowed. "Under no circumstances will an estimate of the floor area be allowed." An approved building plan, or a hand-drawn plan with accurately measured dimensions, will do.
• You do not apportion twice. After the floor-area split, you do not further reduce the amount for the proportion of time spent in the home office. An employee working from home three days out of five claims the full floor-area amount, not three fifths of it. The time question was already answered by the mainly test — and if the room is not exclusively used, no deduction is permitted at all.

Repairs are treated a little differently. A repair to the home office room itself is claimed in full, no apportionment. A repair to the master bedroom window or the garage interior cannot be claimed at all. A whole-roof repair is apportioned by floor area like anything else.

Sectional title owners have an extra step. Where the body corporate carries the rates and municipal charges, the portion of your levy attributable to your own section — and within that, to the home office — is claimable, apportioned by floor area. The portion relating to common property is not. If the split cannot be determined, IN 28 says no deduction is permitted, because you cannot discharge the burden of proof.

The part that can cost more than the deduction is worth

One caution that does not appear in Interpretation Note 28 at all, because it is a capital gains question rather than an income tax one.

Claiming a home office is a statement that part of your home was used for trade. When you eventually sell, the primary-residence exclusion does not cover the part of the property used for purposes other than residence. The exclusion is generous — the gain exclusion moved to R3m in Budget 2026 — but it is not unlimited, and a long-running home office claim on a property that appreciates sharply can cost more on the eventual disposal than it saved in annual deductions. Our guide to capital gains tax in South Africa covers the mechanics of the exclusion; the interaction with a home office is worth a conversation with a tax practitioner before you start claiming, not after you sell.

What to do with this

If you are a salaried employee working from home more than half the year, in a separate room used for nothing else, you have a real claim — for rates, electricity, cleaning, repairs to that room, and wear and tear on your equipment, apportioned by measured floor area. Keep the plan, the municipal bills and your own day-by-day record.

If you are working from the dining table, a shared study, or a guest room, there is no claim, and submitting one invites an audit you will lose.

And if your list starts with bond interest and fibre, it was written for a taxpayer you are probably not. Commission earners are treated differently under section 23(m); the self-employed are outside it entirely.

The deduction is claimed in the "Other Deductions" section of your ITR12 at filing, so it is not something your employer applies to your monthly PAYE. If you have never filed for yourself, our SARS eFiling registration guide covers the first step, and the current income tax brackets and rates will tell you what a deduction is actually worth at your marginal rate.

Frequently asked

My employer told me to work from home. Does that entitle me to the deduction? No. SARS says expressly that whether the employer permits or requires home working "is not the test". The test is where you actually performed more than 50% of your duties, and you have to prove it.

Can my spouse and I both claim if we share a study? Only if you have divided the room into separate parts, each specifically equipped for and used exclusively by one of you. Sharing the same desk and equipment disqualifies both of you.

I rent. Is that better than owning? For this purpose, yes. Rent is expressly within the expenses section 23(m) preserves, while bond interest is not. A tenant claiming a qualifying home office can deduct an apportioned share of rent; an owner cannot deduct an apportioned share of bond interest.

What about my solar system or inverter? IN 28 addresses this. Many solar systems are wired into the property and become works of a permanent nature, which disqualifies them from the section 11(e) wear-and-tear allowance. Where the section 12B(h) allowance would otherwise apply, section 23(m) prohibits it for an employee. The practical answer for most salaried people is no.

Does claiming a home office make me a provisional taxpayer? No. A deduction against employment income does not change your status. Provisional tax is triggered by the kind of income you earn, not the deductions you claim — see our guide for South Africans earning foreign or non-salary income.