Finding 15% of Wear & Tear Allowances, resulting in a R1.6m tax saving in first year

 

Purchase of Office Building

Instructed by a listed property company client to advise on the availability and level of Wear & Tear Allowances following their purchase of an office complex for R290million.

Firstly, we ascertained that the buyer had an entitlement to claim and that they were not restricted by a previous owner’s claim.

We then carried out a detailed property inspection to identify the qualifying assets and to enable us to estimate a replacement cost for the building and subsequently prepared a Wear & Tear Allowances claim as an apportionment of the purchase price.

The total level of Wear & Tear Allowances amounted to in excess of R45million, being some 15% of the purchase price, and resulted in a tax saving in the first year of approximately R1,600,000 and over the first three years of ownership of some R4,900,000.

 
 
 

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Purchase Price

This is the original or anticipated purchase price or development cost of your property.

Do not enter the current value here.

Building Type

Please provide the type of building you are looking to claim allowances on.

Note: You will be able to add further information about the type of building in the next step.

Your options here are;

  • Office.
  • Retail: Including high street, shopping centres and retail warehouses.
  • Mixed Use.
  • Industrial: Including warehouses and distribution centres.
  • Other: Leisure, hotels, casinos etc.
Building Category

Please select the description that best suits your property.

Other Information

Please provide any additional information about your property that you may consider appropriate.

Floor Area

Please enter the total floor area of the property.
You can provide either square footage or metres, but only use figures here.
The floor area you specify can either be gross or net internal space.

Floor Area Units

Please select the type of area e.g. Metres or Feet
and if the measurement has been taken as net or gross internal space.

Date of Purchase

Please enter the approximate month and year of purchase, or
if you have developed the property, please provide the
approximate date of completion.

Location Of Property

Where is the property located? Please provide town/city, and country.