Landlord Tax Deductions South Africa: What You Can Claim in 2026

Every rand you spend to earn rental income is potentially a tax deduction — but only if you claim it correctly. Most South African landlords either don’t know what they can deduct, or they claim the wrong things and trigger a SARS audit.

This guide is your definitive reference. We cover every allowable deduction, explain the capital-vs-revenue trap, and show you how to structure your records so you’re audit-ready year-round.

For an overview of how SARS taxes rental income, start with our rental income tax guide for South African landlords.

The Golden Rule of Rental Deductions

SARS allows you to deduct expenses that are:

Incurred in the production of rental income (Section 11(a) of the Income Tax Act)
Not of a capital nature
Supported by documentation (invoices, receipts, bank statements)

If an expense doesn’t meet all three criteria, it’s not deductible. Let’s work through every category.

1. Bond Interest

This is typically the largest deduction for landlords carrying a mortgage. You can claim the interest portion of your monthly bond repayment — not the capital portion.

Your bank provides an annual tax certificate showing how much interest you paid during the tax year. If you’ve lost it, request a duplicate from your bank’s online portal or branch.

Partial rental use: If only part of the property is rented (e.g., you rent out a cottage on the same stand where you live), you must apportion the interest. A common method is floor-area apportionment:

Deductible interest = Total interest × (Rented floor area ÷ Total floor area)

Example: You paid R90,000 in bond interest. The cottage you rent out is 40m² of a total 160m² property. Deductible interest = R90,000 × (40 ÷ 160) = R22,500.

2. Municipal Rates and Taxes

Rates charged by your local municipality are fully deductible for a rental property. This includes:

Property rates
Refuse removal charges
Sewerage charges

Keep your municipal account statements as proof. If the property is partly rented, apportion as with bond interest.

3. Body Corporate and HOA Levies

If your rental property is in a sectional title complex or estate, the monthly levies are deductible. This includes:

Regular monthly levies
Special levies (deductible in the year they’re charged, even if payment is spread over months)

Special levies for capital improvements to the complex may not be deductible — the same capital-vs-revenue distinction applies. A levy to repaint the building is likely deductible; a levy to build a new clubhouse is capital.

4. Insurance Premiums

You can deduct premiums for:

Building insurance (homeowner’s comprehensive)
Landlord liability insurance
Contents insurance (furnished rentals)
Loss of rent insurance (covers you if the property becomes uninhabitable)

Premiums for personal insurance policies that happen to cover the rental property are not deductible unless they specifically relate to the rental activity.

5. Repairs and Maintenance

This is the most audited deduction category for landlords, because of the critical distinction between repairs (deductible) and improvements (not deductible).

What Counts as a Repair

A repair restores the property to its original condition without enhancing it. Deductible examples:

Fixing a leaking roof
Replacing broken windows with the same type
Repainting after tenant damage or normal wear
Fixing burst pipes or a broken geyser (replacing like-for-like)
Repairing electrical faults
Fixing damaged flooring
Replacing worn-out taps or handles
Servicing a gate motor or garage door
Clearing blocked drains

What Counts as an Improvement

An improvement enhances the property beyond its original state. Not deductible, but added to the property’s base cost for Capital Gains Tax when you eventually sell. Examples:

Adding a new room or outbuilding
Installing a pool or Jacuzzi
Upgrading from wooden windows to aluminium
Replacing a standard geyser with a solar water heating system
Building a carport where none existed
Installing air conditioning
Fitting a new kitchen (not replacing a broken one)

The Grey Area

Some scenarios are genuinely ambiguous:

Replacing an entire roof — if the old one was damaged beyond repair and you replace it with the same materials, it’s likely a repair. If you upgrade from tiles to a more expensive material, the upgrade portion is capital.
Replacing an old kitchen — if the kitchen was functionally broken and you replace it with a similar one, SARS may accept it as a repair. If you install a top-of-the-range upgrade, the difference is capital.

Best practice: When in doubt, get a tax professional’s opinion before claiming. Keep photographic evidence of the “before” state to support your position.

6. Agent and Management Fees

If you use a rental agent, property manager, or management platform, the fees are deductible:

Letting agent commission (typically 8-12% of monthly rent)
Property management fees
Lease renewal fees
Advertising and marketing costs for tenant placement
Platform subscription fees (e.g., Indlu’s management plans)

7. Tenant Screening Costs

Fees paid for credit checks, background checks, and reference verification are deductible. This includes:

TPN credit check fees
TransUnion or Experian checks
Professional reference-checking services
Screening platform subscriptions

8. Legal and Professional Fees

Legal and accounting fees related to the rental activity are deductible:

Drafting or reviewing lease agreements
Debt collection for unpaid rent
Eviction proceedings (legal fees, court costs)
Accounting fees for preparing your rental income tax return
Tax consultation fees related to rental income

Not deductible: Legal fees related to buying or selling the property (these are capital costs).

9. Security Costs

Armed response subscriptions
Security gate or alarm installation (if replacing existing — otherwise capital)
CCTV maintenance
Security guard fees (for complexes or multi-unit properties)

10. Garden and Property Upkeep

If the lease includes these services (or the property standard requires them):

Garden maintenance
Pool cleaning and chemicals
Pest control
Common area cleaning (multi-unit properties)

11. Utilities (When Paid by the Landlord)

If you pay utilities on behalf of the tenant and don’t recover them:

Electricity
Water
Gas
Internet/fibre (if included in the lease)

If the tenant reimburses you, the reimbursement is income and the expense is still deductible — they cancel out.

12. Travel Expenses

You can claim travel costs for trips directly related to managing your rental property:

Property inspections
Meeting tenants
Visiting agents or attorneys
Purchasing supplies for the property

Claim at the SARS-prescribed rate per kilometre (currently R4.64/km for the 2025/26 tax year — confirm each year). Keep a logbook of dates, destinations, distances, and purposes.

Not deductible: Travel to view properties you’re thinking of buying. That’s pre-trade expenditure.

13. Wear-and-Tear Allowances

For furnished rentals, you can claim annual depreciation on movable assets using the straight-line method over SARS-prescribed periods:

Asset	Write-off Period	Annual Deduction (R12,000 item)
Furniture (beds, couches, tables)	6 years	R2,000
Appliances (fridge, stove, washer)	5–6 years	R2,000–R2,400
Carpets and curtains	5 years	R2,400
Electronic equipment (TV, router)	3–5 years	R2,400–R4,000
Linen and towels	2–3 years	R4,000–R6,000

Keep purchase invoices for every item. When an asset is fully written off, you can’t claim further deductions on it.

14. Section 13sex Building Allowance

If you own a new or unused residential building (or a new section of an existing building) that was brought into use for the first time on or after 21 October 2008, you may qualify for a 5% annual building allowance (Section 13sex of the Income Tax Act).

Conditions:

The building must be used solely for residential accommodation
The taxpayer must own at least 5 residential units (doesn’t need to be in the same complex)
The units must be rented to individuals earning below a prescribed income threshold

This is primarily relevant for landlords with multiple properties. If you qualify, it’s a significant deduction — 5% of the building’s cost per year for 20 years.

Common Mistakes That Trigger Audits

Claiming improvements as repairs — SARS’s most targeted audit area for landlords
Not apportioning expenses for mixed-use properties
Claiming without supporting documents — no invoice = no deduction
Claiming personal expenses against rental income (home office costs for “managing” your one rental property rarely holds up)
Double-claiming — deducting an expense in both the rental and business/personal sections
Forgetting to include deposit interest as income while claiming related expenses

How to Structure Your Records

Organise your records into these categories for each property:

Income: Monthly rent received, other income
Bond: Annual interest certificate
Rates and levies: Municipal accounts, body corporate statements
Insurance: Premium notices, payment confirmations
Repairs: Invoices, quotes, before/after photos
Management: Agent statements, platform receipts
Professional fees: Legal and accounting invoices
Other: Security, garden, travel logbook

Keep everything for five years from the date of tax return submission.

Indlu’s expense tracking automatically categorises your spending into SARS-friendly deduction categories and generates year-end tax summaries — so you never miss a deduction and you’re always audit-ready.

Frequently Asked Questions

Can I claim deductions if I’m not registered as a provisional taxpayer?

Yes. You claim deductions on your annual ITR12 return regardless of provisional taxpayer status. However, if your rental income requires provisional tax registration, you should register to avoid penalties.

What if my deductions exceed my rental income?

The resulting rental loss can be offset against your other taxable income (salary, business income). This reduces your overall tax liability. SARS may query persistent losses, so keep records showing genuine intent to earn rental income.

Can I claim for a property that was vacant for part of the year?

Generally yes, provided the property was available for rental during the vacancy period and you were actively seeking tenants. Expenses during a vacancy between tenants are usually deductible.

How do I handle expenses split between two tax years?

Claim expenses in the tax year they were incurred (the date you became liable), not when you paid. An invoice dated 28 February goes in that tax year, even if you pay in March.

Never miss a deduction — Indlu tracks every rental expense and generates SARS-ready summaries. Start free today.