How to track business expenses as a sole proprietor
Track them at the moment they happen, in an account that contains nothing else, with the slip captured as evidence. A sole proprietor's business expenses are deductible against income, but the deduction is only as strong as the record behind it, and SARS may ask for that record five years after the return goes in.
The deduction is real; so is the burden of proof
Stock, tools, fuel for business travel, data, a share of home office costs: legitimate expenses reduce a sole prop's taxable income directly. The catch is that the taxpayer carries the proof. No document, no deduction, and a bank statement line alone does not say what was bought or why it was business.
The slip is the document. It dates the purchase, names the supplier, itemises the goods. Kept legibly, it converts an assertion into evidence.
Slipsort keeps every slip legible for as long as SARS can ask.
Scan in about a second, numbers read for you, one pack per month for your accountant.
Get Slipsort free on iPhoneSeparation is half the system
The classic sole prop failure is one card, one pile, and a February spent reconstructing which purchases were business. Separate the flows at capture: a business account for business slips, personal for the rest. Whether or not the bank accounts are separate, the records can be.
Slipsort makes the account the first choice on every slip, and month-end packs are built per account, so the business's paper trail assembles itself while you shop.
Provisional tax stops being a scramble
Sole props above the threshold pay provisional tax twice a year on estimated income, and a bad estimate costs penalties or an interest-free loan to SARS. Live expense records turn the estimate into arithmetic: the period's spend is already summed on a cover page instead of buried in a drawer.
Quick answers
- Do I need a registered business to deduct expenses?
- No. A sole proprietor trades in their own name and declares business income and expenses in their personal return. The records requirement is the same as for any taxpayer claiming deductions.
- How do I handle expenses paid cash?
- Cash purchases leave no bank line, so the slip is the only evidence they happened. Scan them the same day; a cash expense with no slip is effectively a donation to SARS.