[Question] Electronic Equipment Rental Income

[Biz_With_Bruce]

Good day,

Thanks for reading this far, the rest might be boring.

I want to find out if an individual only earn a rental income from renting out electronic equipment (No Salary, No Boss, No Interest, No Pension, No Other income)
Is this then taxed as if this electronic equipment rental income (not property rental income) was my salary?
Sole proprietor, (Not CC Not Pty Ltd Not any other company type)
The rental income is around R6,900 per month; which is as far as I know, (if this is the same tax calc as normal salaries) not enough to pay any tax on as it is below the annual tax rebate.

I might have more questions depending on the above answer.
Thank you for your time

[Andromeda]

It is the same. At R7,325 you pay R4. At R6,900 you pay nil. However be sure that the R6,900 is your total income, and not the income from only one outfit while there are others.

[Biz_With_Bruce]

It is the same. At R7,325 you pay R4. At R6,900 you pay nil. However be sure that the R6,900 is your total income, and not the income from only one outfit while there are others.

Thanks for the reply, yes this is the only income this person has; funny story, or not so funny
This person registered for tax in may 2020, seeing as this rental income started in march 2020.
SARS required the tax returns for 2019 and 2020 to be completed, which were simple enough, seeing as both years were unemployed and completed as such.
Now SARS want supporting evidence of this.
This person and myself has no idea what to send as proof of unemployment.
Any suggestions, apart from scanning a blank peace of paper and sending that in?

[Justloadit]

Maybe draw up an affidavit stating that he was unemployed for the period requested.

[Dave A]

Any suggestions, apart from scanning a blank peace of paper and sending that in?

[Andromeda]

Thanks for the reply, yes this is the only income this person has; funny story, or not so funny
This person registered for tax in may 2020, seeing as this rental income started in march 2020.
SARS required the tax returns for 2019 and 2020 to be completed, which were simple enough, seeing as both years were unemployed and completed as such.
Now SARS want supporting evidence of this.
This person and myself has no idea what to send as proof of unemployment.
Any suggestions, apart from scanning a blank peace of paper and sending that in?

I always wonder how one proves nothing.

That said, follow Justloadit's advise.

[adrianh]

SARS required the tax returns for 2019 and 2020 to be completed, which were simple enough, seeing as both years were unemployed and completed as such.
Now SARS want supporting evidence of this.
This person and myself has no idea what to send as proof of unemployment.
Any suggestions, apart from scanning a blank peace of paper and sending that in?

I suppose what they are asking is if he was unemployed then how did he live. (how as his rent paid, who paid for electricity etc) - Unemployment does not necessarily mean no monies passing to him - The question is fair if one looks at the broader implications of being unemployed.

The only proof would be showing his bank statements for that period - Incoming funds would then be justified as gifts or whatever. (Hopefully he operated on a cash basis during that period so there is nothing to show).

[Biz_With_Bruce]

I suppose what they are asking is if he was unemployed then how did he live. (how as his rent paid, who paid for electricity etc) - Unemployment does not necessarily mean no monies passing to him - The question is fair if one looks at the broader implications of being unemployed.

The only proof would be showing his bank statements for that period - Incoming funds would then be justified as gifts or whatever. (Hopefully he operated on a cash basis during that period so there is nothing to show).

Just an update on this for the interested parties,
first just to answer the above, this was the first year of assessment, the person was a home executive for 20 years, so the spouse has always provided.
It does nook like sars did realize that this does not make sense, after we tried to call the national call center, pressed the button for the callback service, then the recording stated there is technical difficulties, which resulted in never receiving a call back; but anyway, sars did finalize these two years without and further comments or submissions. Which was good.
Then we submitted the 2021 return with the rental income and some foreign income and basically only depreciation as a deduction, this return was assessed immediately and was not selected for audit or verification or any additional documentation submission required.

So all's well that ends well.

[adrianh]

Just an update on this for the interested parties,
first just to answer the above, this was the first year of assessment, the person was a home executive for 20 years, so the spouse has always provided.
It does nook like sars did realize that this does not make sense, after we tried to call the national call center, pressed the button for the callback service, then the recording stated there is technical difficulties, which resulted in never receiving a call back; but anyway, sars did finalize these two years without and further comments or submissions. Which was good.
Then we submitted the 2021 return with the rental income and some foreign income and basically only depreciation as a deduction, this return was assessed immediately and was not selected for audit or verification or any additional documentation submission required.

So all's well that ends well.

I think that SARS have their hands full with so many people and businesses going belly up.

Brilliant - I'm glad it got sorted.