To claim a deduction of 150% under section 11D of the Act, the taxpayer needs approval from the Minister of Science and Technology. Without the approval, the deduction cannot be claimed under section 11D. It often happens in practice, however, that approval is granted only after the taxpayer’s year of assessment for which the deduction is sought and after the tax return for that year has been submitted. In these cases, taxpayers are allowed to request SARS to allow the deduction in the year of assessment to which the expenditure relates under section 11D(20) of the Act.
In fact, a taxpayer can request the deduction even if the original assessment has prescribed (i.e. even if approval is granted more than three years after the original assessment was issued), provided requirements are satisfied. It is worth noting that claiming expenses actually incurred in one year in any other year is a criminal offence and will expose taxpayers to penalties.