If a member of a CC operates their business from their private home, how does one go about structuring that?
The costs (bond interest, rates, utilities etc) are in the name of the member as the property is held in their personal name. The obstacles I can't get my head around are:
1. I can't claim Home Office Deduction on their member's personal tax return. They earn Code 3615 income (directors/members salary) and SARS have denied this in the past and issued additional assessment upon review.
2. I can't raise rental invoices from the member personally to the CC, claim the expense of those invoice in the CC and their declare 'local trade' on the Member's personal tax return with income and deductions (for specific use area) at equal value to nil out. The reason being is that it is primarily the private residence and by 'renting' space out of it the member will then change the use and loose the Capital Gain concession as a primary residence when they sell one day. I also read an article of this issue coming up with SARS in the past.
The CC genuinely operates out of space exclusively setup and used for the business' purpose, but I don't know how to include the (prorate) property costs for this into the CC's accounts and properly back it up with supporting vouchers in case of review/audit.
Any guidance or advice would be greatly appreciated :-)