Welcome to the latest edition of Employer Connect, the electronic newsletter for employers that keeps you up to date with the tax matters that affect you. This edition covers the Interim Reconciliation period, the discontinuation of the debit pull payment option and changes to banking details.
Every year employers need to comply with the requirement to submit their Employer Annual Reconciliation. But it is not just a matter of compliance – it is also an important part of ensuring an efficient and effective tax administration for our country by paving the way for the annual tax season for individuals.
The deadline to submit your Annual Reconciliation for the period 1 March 2013 to 28 February 2014 is Friday 30 May 2014. So please submit your reconciliation early as this will give you time to resolve any issues which may arise.
Remember to use the latest version of [email protected]™ Employer available which is a free a quick, easy and accurate way to complete your declaration. You can download it from the eFiling website www.sarsefiling.co.za
Always backup your current information on your computer before installing a new version of [email protected]™ Employer, as the installation may delete your current information.
This year there are a number of changes that have been introduced into the annual reconciliation process, one of the key ones being the need to include government’s new Employment Tax Incentive (ETI).
The ETI came into effect on 1 January 2014 to encourage private sector employers to employ young work seekers by providing a tax incentive. Qualifying employers are able to claim the ETI and reduce the amount of Pay-As-You-Earn (PAYE) payable to SARS.
To see if you are a qualifying employer or employed qualifying employees visit www.sars.gov.za > Tax Types > PAYE > Employment Tax Incentive. Any amounts claimed for ETI on your Monthly Employer Declaration (EMP201) must be included in the spaces provided when completing your annual reconciliation submission.
One of the new source codes is:
ETI (4118) – The sum of the ETI amounts calculated (theoretical amounts) for the employee during the year of assessment. The value of this code cannot be a negative.
Updated source codes [IRP5/IT3(a)]
- Code 3703 may not be reflected on an IRP5/IT3(a) together with code 3701 and/or 3702. The value of code 3703 must be included in the value of code 3702 under these circumstances.
- Code 3802 – Use of motor vehicle acquired by employer NOT via Operating Lease (PAYE). Code 3852 MUST only be used for Foreign Service income.
The postal address information for employees has been updated to align to the new SARS structure. [IRP5/IT3(a)]
These fields must be updated before you submit your reconciliation. The requirements are listed in Appendix D of the Business Requirement Specification: PAYE Employer Reconciliation (including the Employment Tax Incentive requirements).
The Standard Industrial Classification (SIC7) code has been included
The list of the codes is available in Appendix E of the Business Requirement Specification: PAYE Employer Reconciliation (including the Employment Tax Incentive requirements).
Please note: Retirement Funds/Fund Administrators are required to submit the SIC7 codes. Code 64300 must be entered, which is the “trust, funds and similar financials entities” code. This information will be excluded for the 2015 Employer Interim Reconciliation submission.
- Submit your reconciliation before the deadline of 30 may 2014.
- eFiling may be used as a submission channel where you have 20 or less IRP5/IT3(a)s to submit with your EMP501.
- Submit complete and accurate reconciliation documents
- The latest Business Requirements Specifications (BRS) is available on the SARS website www.sars.gov.za.