Complete new roof on a property you rent out
Depends
Replacing a whole roof usually reads as an improvement, especially if the new roof is better than the old one, so the deduction is far from automatic.
The answer turns on the facts · Landlord
Repairing part of a roof restores the property. Replacing the entire roof renews a substantial whole and SARS often treats it as capital. Changing the character or quality of the roof, for example thatch to tile, or adding insulation and new trusses that were not there, pushes it firmly into improvement. Where a like for like replacement was forced by damage and the property is simply back to its former condition, a repair argument exists but you must be able to evidence it.
Where people go wrong
Assuming that because the roof leaked, the whole replacement is a repair. The leak proves the need, not the character of the spend. If you are replacing everything, expect to defend it, and get an assessor or contractor report describing the old roof's condition and confirming like for like.
Does buying it save you tax?
This is a large number and the tax answer moves a lot of money, so it is worth paying a practitioner to look at the quote before the work starts, not after.
Authority s11(d)
governed by Repairs are deductible, improvements are not
may unlock Improvements to a let property increase base cost
Property
Research, not advice.
This has not yet been checked against the Act or a SARS guide, so treat it as a starting
point and a question for your practitioner, not a claim you can make.
New roof, or a roof replaced over the home office
Depends
Patching a leaking roof is a deductible repair on the office share, while replacing the entire roof is almost always capital and gives you no deduction now.
The answer turns on the facts · Anyone
The facts that decide it are whether the work restores the roof to its previous condition or replaces the whole thing with something new or better. Fixing a leak over the office is a repair, apportioned by floor area unless the work is confined to the office. A full re-roof, or replacing tiles with a superior material, is an improvement to a capital asset. Capital work of this kind is not deductible but the cost may be added to the base cost of the property for capital gains, so keep the invoices for as long as you own the house.
Where people go wrong
Splitting a genuine improvement into small invoices described as repairs. SARS looks at the nature of the work, not the wording, and a whole new roof is not a repair whatever the quote says.
Does buying it save you tax?
As a tax play, no. As a base cost record, absolutely keep the paperwork, because improvement costs are the most commonly lost part of base cost when a property is eventually sold.
Authority s11(d)
governed by Repairs to business property
may unlock Base cost includes far more than the purchase price
Home office
Research, not advice.
This has not yet been checked against the Act or a SARS guide, so treat it as a starting
point and a question for your practitioner, not a claim you can make.
