A commission earner – claiming expenses

The position for commission earners is similar to that of a salaried employee, yet less onerous practically. Commission earners who earn more than 50% of their total remuneration as commission income are not limited in the type of business expenses they can claim, as long as these are incurred in the production of their income and not of a capital or personal nature. 

Total remuneration includes basic salary, medical aid contributions, group life premiums and any retirement fund contributions made by the employer. 

Consequently, if more than 50% of the total remuneration is commission income, as recorded under code 3606, the commission earner is entitled to claim business expenses. 

Home office expenses being one of the expenses that can be claimed by commission earners, where more than 50% of their work performances and duties are performed in a place other than the office provided by the employer. 

Other expenses include service fees, such as accounting, legal and administration fees paid to providers of these services. Expenses could also include telephone work calls and stationary. 

The benefit of being able to claim expenses as a commission earner (either working from home or elsewhere) comes with an additional administrative burden by tracking and keeping account of all expenses. 

Do keep a record together with the related invoices, as you have to submit this documentation to SARS when filing your tax return.