You cannot deduct the cost of a capital asset in the year you buy it. Instead you claim a wear and tear allowance spread over the asset's write-off period, using the periods SARS publishes in Binding General Ruling 7. Accounting depreciation is added back in the tax computation and replaced by this allowance — they are almost never the same number.
Two exceptions matter for small businesses: small-value items can generally be written off in full immediately, and a qualifying Small Business Corporation gets substantially accelerated treatment.
The basic rule
Capital expenditure is not deductible. Buying a machine, a computer or office furniture is the acquisition of an asset, not an expense.
What you claim instead is a wear and tear allowance, spread over the period SARS accepts for that asset type, on the straight-line basis, from the date the asset is brought into use.
"Brought into use" matters. An asset bought in February but only installed and operating in April starts its allowance in April, not February. Buying equipment on the last day of the year to create a deduction does not work unless it is actually in use.
The write-off periods
SARS publishes acceptable write-off periods in Binding General Ruling 7. Common examples:
| Asset | Write-off period |
|---|---|
| Computers (personal or laptop) | 3 years |
| Computer software (purchased) | 2 years |
| Computer servers | 5 years |
| Office furniture and fittings | 6 years |
| Office equipment — electronic | 6 years |
| Motor vehicles | 5 years |
| Delivery vehicles | 4 years |
| Air conditioners | 6 years |
| Cell phones | 2 years |
| Kitchen equipment | 6 years |
| Shop fittings | 6 years |
| Machinery — general | 5 years |
Confirm the period for your specific asset against BGR 7 rather than assuming from a similar item — the list is long and the categories are specific.
Worked example. A laptop costing R28,000, brought into use on 1 June, on a February year-end.
Write-off period: 3 years
Annual allowance: R28,000 ÷ 3 = R9,333
Note: wear and tear on most assets is not apportioned for part of a year — the full annual allowance is generally claimed in the year the asset is brought into use. Certain assets and allowances are apportioned, so confirm the treatment for the specific asset.
Small-value items
Assets costing less than the prescribed small-value threshold can generally be written off in full in the year of acquisition rather than depreciated.
This covers a great deal of ordinary business spending — a keyboard, a chair, a small tool, a phone accessory. Check the current threshold, as it is adjusted from time to time.
The practical point: a business buying twenty small items a year should not be depreciating them individually. That is administrative effort with no tax benefit.
The Small Business Corporation acceleration
If your company qualifies as an SBC under section 12E, the treatment is materially better.
| Asset type | SBC treatment |
|---|---|
| Qualifying manufacturing assets | 100% in the year brought into use |
| Other qualifying assets | 50% / 30% / 20% over three years |
Worked example. An SBC buys R400,000 of qualifying manufacturing plant.
SBC: R400,000 deducted in year one. At 27%, that is R108,000 of tax deferred into the current year
Non-SBC, 5-year write-off: R80,000 deducted in year one
The difference in year one is R320,000 of deduction — a substantial cash flow benefit at exactly the point a growing manufacturer needs it.
This is one of the strongest reasons to check SBC qualification. See what is the company tax rate in South Africa.
Accounting depreciation vs tax wear and tear
They are different numbers calculated for different purposes, and confusing them is a common error in the tax computation.
| Accounting depreciation | Tax wear and tear | |
|---|---|---|
| Set by | You, based on useful life | SARS write-off periods |
| Method | Straight line, reducing balance, units of production | Generally straight line |
| Residual value | Often assumed | Generally not |
| Purpose | Fair presentation | Tax deduction |
In the tax computation, accounting depreciation is added back and wear and tear is deducted. See what is an ITR14.
This is why your fixed asset register needs two columns — accounting carrying value and tax value. They diverge from year one and the gap widens.
Selling an asset: recoupment
When you sell an asset you claimed wear and tear on, there is a tax consequence.
Where you sell for more than the tax value, the difference up to original cost is recouped — added back to taxable income. You are effectively giving back allowances you claimed on value the asset did not actually lose.
Worked example. Equipment cost R150,000, wear and tear claimed R90,000, tax value R60,000. Sold for R95,000.
Proceeds: R95,000
Tax value: R60,000
Recoupment: R35,000 added to taxable income
Taxable at 27% for a company: R9,450
Where proceeds exceed original cost, the excess above cost is a capital gain rather than a recoupment.
Where you sell for less than tax value, a scrapping allowance may be available for the shortfall.
The practical warning: selling old equipment can create a tax liability you did not expect. Factor it in before disposing of assets, particularly near year-end.
Keeping the register
A fixed asset register is not optional if you are claiming wear and tear. SARS asks for it on verification.
For every asset, record:
Description and serial or identifying number
Date acquired and date brought into use
Cost, excluding VAT if you claimed the input tax
Write-off period applied
Allowance claimed each year
Accumulated allowances
Tax value
Accounting carrying value
Date and proceeds on disposal
Keep the purchase invoices. A wear and tear claim without the underlying invoice is a claim you will lose.
Frequently asked questions
How does wear and tear work for tax in South Africa? Capital assets cannot be deducted in the year of purchase. Instead you claim a wear and tear allowance spread over the write-off period SARS accepts for that asset type, generally on the straight-line basis, starting from the date the asset is brought into use.
What are the SARS write-off periods for assets? Typical examples include three years for computers, two years for purchased software and cell phones, five years for motor vehicles and general machinery, four years for delivery vehicles, and six years for office furniture, air conditioners and shop fittings. The full list is in Binding General Ruling 7.
Can I deduct the full cost of equipment in the year I buy it? Generally no, unless the item falls under the small-value threshold, or your company qualifies as a Small Business Corporation, in which case qualifying manufacturing assets are written off 100% in year one and other qualifying assets over three years on a 50/30/20 basis.
What is the difference between depreciation and wear and tear? Depreciation is an accounting figure based on the useful life you assign. Wear and tear is the tax allowance based on SARS write-off periods. In the tax computation, accounting depreciation is added back and wear and tear is deducted, so the two numbers rarely agree.
Do I claim wear and tear from the date I buy the asset? From the date it is brought into use, not the date of purchase. An asset bought in one year but only installed and operating in the next starts its allowance in the later year.
What happens when I sell an asset I claimed wear and tear on? Where the proceeds exceed the tax value, the difference up to original cost is recouped and added to taxable income. Proceeds above original cost are treated as a capital gain. Selling for less than tax value may give rise to a scrapping allowance.
Do I need a fixed asset register? Yes, in practice. SARS requests it on verification, and without it a wear and tear claim is difficult to substantiate. It should record cost, date brought into use, write-off period, allowances claimed, tax value and accounting carrying value for every asset.
The register that supports the claim
Wear and tear is straightforward arithmetic. What fails in a verification is the record — an asset register that was never maintained, and invoices nobody kept.
Smartbook maintains the fixed asset register as part of monthly accounting, applies the correct write-off periods, checks SBC qualification for the accelerated allowances, and calculates recoupments before you dispose of anything.
Last reviewed: 26 July 2026. Written by the Smartbook team — SAIPA and SAICA accredited, SARS registered tax practitioners. Write-off periods shown are typical examples from Binding General Ruling 7 — confirm the applicable period for your specific asset. Apportionment rules and the small-value threshold change; confirm current figures. Worked examples are illustrative.
Primary sources: SARS — Binding General Rulings · SARS — Income Tax · SARS — Small Businesses Taxpayers · SARS — Budget 2026 FAQs