Home Office Tax Deduction South Africa — Who Qualifies and How to Calculate (2026)
Working from home does not automatically entitle you to a home office tax deduction. SARS has specific requirements — the most important being that the room must be regularly and exclusively used for work. This guide explains who qualifies, which expenses you can deduct, how the calculation works, and the key 2023 change regarding mortgage interest.
From the 2023 tax year onwards: Employees can no longer deduct mortgage bond interest as a home office expense. This was clarified in Interpretation Note 28 (Issue 3), published 4 March 2022.
Source: SARS — Home Office Expenses page — sars.gov.za; Interpretation Note 28
Stricter rules apply — Section 23(m)
Must work mainly from the home office AND the room must be exclusively used
Employee qualification rules →More flexible rules under Section 11(a)
Room must be exclusively used; no "mainly" requirement
Self-employed and commission earner rules →Who qualifies for the home office deduction?
SARS allows a home office deduction under Section 11(a) read with Sections 23(b) and 23(m) of the Income Tax Act. The rules are different for employees and self-employed persons.
Source: SARS — Home Office Expenses page — sars.gov.za
Category 1 — Salaried employees
To qualify, ALL of the following conditions must be met:
Condition 1: The room is regularly and exclusively used for work
The home office must be set up solely for your work — no dual personal use. This is the most strictly applied condition.
SARS example (Interpretation Note 28 — Issue 3): "R is employed as a tax consultant. On R's premises is a separate room used as a home office, specifically equipped and regularly used for employment. The office is the only north-facing room, and R's children are permitted to play in the room on winter afternoons and on weekends. R's home office is NOT used exclusively for purposes of R's trade."
A room that is used for anything personal — even occasionally — does not qualify.
Source: SARS — Interpretation Note 28 (Issue 3), 4 March 2022
Condition 2: The room is specifically equipped for work
The room must have equipment appropriate for your specific work — a desk, computer, specialised equipment, etc.
Condition 3: Your duties are mainly performed in this home office
Under Section 23(m), salaried employees can only claim the home office deduction if their duties are mainly performed in the home office. "Mainly" means more than 50% of your working time.
This means: if you attend an office three days a week and work from home two days, you likely do NOT qualify — your duties are not mainly performed at home.
Source: SARS — Home Office Expenses page; Section 23(m) of the Income Tax Act 58 of 1962
Category 2 — Commission earners
If more than 50% of your total remuneration is commission (variable pay based on performance), Section 23(m) does not apply to your commission income. This means you are not subject to the "mainly performed" condition for the commission portion.
You must still meet Conditions 1 and 2 (exclusively used; specifically equipped).
Source: SARS — Individual Deductions page; Interpretation Note 28
Category 3 — Sole proprietors and freelancers
Self-employed individuals (sole proprietors, freelancers, independent contractors) claim home office expenses directly under Section 11(a) — the general deduction provision. Section 23(m) does not apply.
Conditions to meet:
- The room must be regularly and exclusively used for the purposes of your trade
- The expense must be incurred in the production of income
Source: SARS — Individual Deductions page; ITA Section 11(a)
| Category | Exclusively used | Specifically equipped | Mainly performed at home |
|---|---|---|---|
| Salaried employee | Required | Required | Required Section 23(m) |
| Commission earner (commission > 50%) | Required | Required | Not required for commission portion |
| Sole proprietor / freelancer | Required | Not explicitly required as separate condition | Not required |
Source: SARS — Home Office Expenses page; Interpretation Note 28 (4 March 2022)
Both spouses can claim:
If two spouses both work from home, each can claim their own home office deduction — even if they share the same residence. Interpretation Note 28 (Example: X the lecturer and Y the paralegal) confirms this.
Each claims their own home office area proportion. If they share a home office space, the deduction would apply to the shared area proportionally.
Source: SARS — Interpretation Note 28 (Issue 3), 4 March 2022
What home office expenses can you deduct?
The two categories of deductible expenses:
- Rent Full monthly rent × A/B ratio
- Rates and taxes Council/municipal rates × A/B ratio
- Electricity and water Running costs × A/B ratio
- Repairs to the home General repairs (not capital improvements) × A/B ratio
- Cleaning costs Cleaning services for the home × A/B ratio
- Home insurance Building/content insurance premium × A/B ratio
- Wear and tear on office equipment Claimed under Section 11(e) at SARS rates; business portion only
- Internet and data costs Business proportion of monthly bill
- Phone costs Business proportion
- Office stationery Business portion
Source: SARS — Home Office Expenses page
What you CANNOT deduct (employees):
| Expense | Reason |
|---|---|
| Mortgage bond interest | No longer deductible from the 2023 tax year — clarified in Interpretation Note 28 (Issue 3, 4 March 2022) |
| Capital improvements to the home | Capital expenditure is excluded |
| Bond capital repayments | Capital expenditure |
| Furniture purchased for the home office | Not deductible as premises expense; may qualify for wear-and-tear depreciation as equipment |
| Personal expenses in the home | Any expense not related to the office space |
Source: SARS — Home Office Expenses page; Interpretation Note 28
Mortgage interest — important note:
SARS previously allowed employees to claim mortgage bond interest as part of home office expenses. This practice ended from the 2023 tax year (tax year ending 28 February 2023) following the publication of Interpretation Note 28 (Issue 3) on 4 March 2022. Employees who claimed mortgage interest in earlier years did so correctly for those years — but it is not deductible from 2023 onwards.
Source: SARS — Home Office Expenses page
Solar power note:
If your home runs on solar power and you use the solar installation for your home office, the electricity running costs can be included in the premises expenses apportionment. The capital cost of the solar installation itself is not deductible.
Source: SARS — Home Office FAQ — sars.gov.za
How to calculate your home office deduction — the A/B formula
Where:
A = Area (m²) of the home office (regularly and exclusively used for work)
B = Total area (m²) of the entire residence (including all rooms, outbuildings, and the office)
Total costs = Qualifying premises-related expenses for the year
(rent OR bond interest NOT included from 2023 for employees; rates;
electricity; repairs; cleaning; insurance)
Source: SARS — Home Office Expenses page — sars.gov.za
Important notes on the formula:
- B includes the home office area: the total area (B) includes the home office itself — not just the "other" rooms
- Outbuildings are included in B: a garage or garden cottage used as the home office is included in both A and B
- Capital costs are excluded: do not include bond repayments, renovation costs, or improvement expenses in "total costs"
Step-by-step calculation:
- Measure your home office area in m² (Area A)
- Measure your total home area in m² (Area B — the whole property including outbuildings)
- Calculate the ratio: A ÷ B = the home office percentage
- Total all your qualifying premises expenses for the year
- Multiply: home office % × total premises expenses = home office deduction
Source: SARS — Home Office Expenses page
- Home office: 15m²
- Total home: 150m² (including outbuildings)
- Ratio: 15 ÷ 150 = 10%
Annual premises costs:
| Rent | R144,000 |
| Electricity | R18,000 |
| Rates and taxes | R8,400 |
| Cleaning | R7,200 |
| Total premises costs | R177,600 |
This R17,760 is deductible against the employee's taxable income for the year (if all qualification conditions are met).
- Home office: 20m²
- Total home: 200m²
- Ratio: 20 ÷ 200 = 10%
Annual premises costs:
| Bond interest | R120,000 |
| Rates and taxes | R12,000 |
| Electricity | R24,000 |
| Repairs | R6,000 |
| Insurance | R8,400 |
| Total premises costs | R170,400 |
CGT and home office — the primary residence "taint"
When you claim a home office deduction, the portion of your home used as an office "taints" the primary residence CGT exclusion that would otherwise apply to the full home.
When you eventually sell the property, the capital gain or loss must be apportioned between:
- The primary residence portion (qualifying for the R3,000,000 exclusion)
- The home office (business use) portion (subject to normal CGT)
The apportionment is based on:
Source: SARS — Home Office Expenses page — sars.gov.za
• Home office = 10% of total area
• Used as home office for 5 of the 10 years of ownership = 50% of the period
• Tainted portion = 10% × 50% = 5% of the total capital gain is subject to CGT (the home office taint)
• The remaining 95% of the gain qualifies for the R3,000,000 primary residence exclusion
For most homeowners, the "tainted" portion is small and the CGT cost is manageable — especially given the R50,000 annual CGT exclusion. However, for high-value homes with significant gains, this is worth calculating before deciding to claim home office expenses.
Source: SARS — Home Office Expenses page; CGT primary residence exclusion: SARS — sars.gov.za/tax-rates/income-tax/capital-gains-tax-cgt/ (updated 25 February 2026)
How to claim your home office deduction on your ITR12
Your home office deduction is claimed under source code 4028 (Home Office Expenses) in the "Other Deduction" container on your ITR12.
Source: SARS — Home Office Expenses page
"Did you incur any expenditure that you wish to claim as a deduction that was not addressed by the previous questions?" → Yes → "Other Deductions" section opens
Step-by-step on eFiling:
- Log in to eFiling (sarsefiling.co.za) and request your ITR12
- Complete the return wizard — when you reach the question: "Did you incur any expenditure that you wish to claim as a deduction that was not addressed by the previous questions?" — answer Yes
- The "Other Deductions" section will be added to your return
- Enter your calculated home office amount next to source code 4028
- Retain all supporting documentation — SARS may request these
SARS may request these supporting documents:
- Floor plan or sketch showing the home office area and total home area
- Lease agreement (renters) or title deed and bond statement (owners)
- Municipal rates account
- Electricity bills for the year
- Cleaning invoices
- Repair invoices
- Evidence that the room was exclusively used for work (specialist equipment, dedicated setup)
Source: SARS — Home Office Expenses page; tax practitioner best practice
Frequently Asked Questions
Related guides
Income tax guides
Calculators & forms
Sources and references
All home office deduction information on this page is sourced from, or verified against, the following official and authoritative references:
- SARS — Home Office Expenses — sars.gov.za/types-of-tax/personal-income-tax/filing-season/home-office-expenses/
- SARS — Interpretation Note 28 (Issue 3), 4 March 2022 — LAPD-IntR-IN-2012-28 (exclusively used example; dual-spouse example; mortgage interest clarification)
- SARS — How do I declare home office expenses? — sars.gov.za/faq/how-do-i-declare-home-office-expenses/
- Income Tax Act 58 of 1962 — Section 11(a); Section 23(b); Section 23(m)
- SARS — Capital Gains Tax rates — sars.gov.za/tax-rates/income-tax/capital-gains-tax-cgt/
Last reviewed: March 2026. Next review: when SARS updates Interpretation Note 28 or the Home Office Expenses page.