If you company undertakes R&D in South Africa, you have very good/every reason to claim for the R&D Tax Allowance. It allows your company to deduct an additional 50% on Operational R&D Expenses from taxable income. This reduces your taxable income. The R&D Tax Incentive translates to an effective 14% reduction in SARS income taxes.

There are additional deductible expenditure:

  • you are allowed to deduct the full cost of pilot equipment [or moulds, etc] in the year of the expense
  • you are allowed to rapidly depreciate plant and machinery over 3 successive years at 50%, 30% and 20%

What business expenses are tax deductible?