Rental Income - Assets and Liabilities

[Mike C]

I have a flat that, for the first time, is generating rental income for me. There is no bond owing on the flat.

I understand that I have to declare the rental income to SARS and have done all the Income minus costs ... there is no problem there.

What I want to know is - do I have to fill in the Assets and Liabilities section that automatically opens up with this section?

It is almost as though Rental Income is an addon .... the section reads ... Local Business, Trade and Professional Income (incl. rental income)

I have only found two specific instances adressing this on the internet. One that says that the Assets and Liabilites secion is only for provisional tax payers, and another which says that it should be filled in, but some people don't.

Anybody have experience in this matter?

[dellatjie]

Mike,

If you earn rental income, you are a provisional taxpayer, therefore yes, you have to complete the assets and liabilities part.

P.S. Did you claim expenses in prior years where you haven't earned income yet? Then at least you will have an assessed loss to use in the next few years.. for example finance charges, repairs and maintenance, etc..

[Mike C]

Hi Dellatjie - thanks for responding. I did not claim in the past because the flat was used by my daughter, but she has moved out, so it is the first time that it has been rented out.

Perhaps you could help on a question of assets then. My primary residence is joint-owned by my wife. We are married out of community of property (the old ante-nuptial and there is no accrual system). As an asset do I then declare half of the purchase value ... being "my half"?

[Dave A]

My primary residence is joint-owned by my wife. We are married out of community of property (the old ante-nuptial and there is no accrual system). As an asset do I then declare half of the purchase value ... being "my half"?

I'm in the same boat, and that's exactly how we do it. Same goes for shared liabilities, like the bond on the property (even though I pay the entire bond instalment). Just as well funds moving between spouses doesn't attract tax, otherwise things could get messy...