SARS Tax Law Changes for 2024 – What You Need to Know

SARS has rolled out some changes to the tax laws for the 2024 tax season, and it’s very important for you to understand these updates so you don’t get caught out.

Don’t stress though—we’re here to break it all down for you.

Here’s what you, as a (Pty) Ltd company owner, need to know:

1. Assets Acquired with Government Grants

If your company receives a government grant to purchase an asset, you can no longer claim a wear and tear deduction on that asset.

So, if the asset was funded through a government grant, you can't depreciate it for tax purposes.

This change will directly impact how you calculate your company's taxable income, so make sure to factor this into your tax planning.

2. Credit Agreements and Debtors’ Allowance

For companies offering lay-bys or similar credit agreements, there’s some good news – you can now claim an allowance for these transactions.

However, there’s a catch—you must reverse this allowance the following year, so careful tracking is essential in your tax filings. This change offers a bit of a breather for companies that rely heavily on credit sales, but it does require you to stay on top of the records.

3. Learnership Agreements

If your (Pty) Ltd company signed any learnership agreements before 1 April 2024, you can claim additional tax deductions for them.

SARS has also added a new question to the tax return forms to confirm the dates of these agreements. So, if you have learnerships in place, ensure you have all the necessary documentation to claim these deductions.

4. Renewable Energy Deductions

Here’s an exciting update for companies looking to go green: SARS now offers an enhanced deduction for investing in renewable energy equipment.

So, if you invest in solar panels or other renewable energy systems, you can claim a 125% tax deduction on these investments. This incentive is part of a broader push to encourage businesses to adopt more sustainable practices.

It’s a golden opportunity for (Pty) Ltd companies considering renewable energy solutions to not only cut operational costs but also benefit from a significant tax break.

You’ve got this!

Navigating tax changes can feel overwhelming, especially when new rules are introduced each year. For (Pty) Ltd companies, staying informed about SARS’ latest updates is essential to avoid penalties and make the most of the available tax benefits.

From understanding restrictions on assets purchased with government grants to leveraging renewable energy incentives, these changes could significantly impact your company’s financial strategy in 2024.

Feel free to share this guide with your network to help other (Pty) Ltd companies stay informed about the 2024 tax changes.