Pay As You Earn

What’s New?  

• 2 April 2026 – Updated PAYE Employer Reconciliation BRS (2026 Release) Version 25 2 0

  What has changed: Source code 4590 has been removed.

• 27 March 2026 – Employer Annual Declarations (EMP501): 1 April to 31 May 2026

Employer compliance is a legal obligation and a critical pillar of South Africa’s tax system. The accurate and timely submission of employer data enables SARS to fulfil its mandate to support the state in providing for the well‑being of all South Africans.

SARS is committed to delivering a clear, consistent, and predictable taxpayer experience; however, a smooth filing season depends on employers’ adherence to their statutory responsibilities.

This letter sets out your obligations, key requirements and available support during the 2026 Employer Annual Declaration period and highlights the importance of full compliance.

Employees’ Tax Compliance Starts with You, the Employer

The Employer Annual Declaration period opens on 1 April 2026 and closes on 31 May 2026. During this period, employers are required by law to submit their annual reconciliation declarations (EMP501) containing accurate, complete, and up‑to‑date employee payroll and tax information. Employer data is a primary input into:

• • Employee tax assessments
  • Auto Assessments and
  • Pre‑populated Income Tax Returns (ITR12).

Failure to submit accurate information on time may result in:

• • Incorrect employee tax assessments;
  • Delays in processing and finalisation;
  • Unnecessary verifications and rework;
  • Adverse consequences for employees; and
  • Non‑compliance penalties for employers.

Employers are accountable for the quality, completeness, and timeliness of their submissions.

What Must Be Included in Your EMP501 Submission

Your EMP501 submission must include:

• • All prescribed employer declarations and
  • Employee tax-certificate information for the relevant tax year.

Employers must issue employee tax certificates (IRP5/IT3[a]) accurately and timeously. Employees rely on these certificates to meet their own tax obligations.

The failure to issue tax certificates on time, or the submission of incomplete or incorrect reconciliation information, constitutes non‑compliance and may result in penalties, enforcement action, and downstream disruption of employees’ tax outcomes.

What’s New and Important for 2026

1. 1. Mandatory Income Tax Reference Numbers

Valid Income Tax Reference Numbers are mandatory for employer submissions. Employers should verify employee details early and register employees where required before submitting. Missing or invalid Income Tax Reference Numbers will prevent certificates from being captured or result in incomplete submissions, leading to delays and non‑compliance.

1. 2. Technical Clinics (New Support Intervention)

SARS is introducing technical clinics as an early readiness intervention. The clinics are practical sessions that help employers and relevant third-party data providers prevent common errors before submission, reduce rework, and improve data quality. More information, including the clinic topics, dates, and how to access the clinics, will be communicated soon. Please be on the lookout for further details on official SARS channels.

1. 3. Social Media Live Q&A Sessions (New Support Intervention)

SARS will also host social media live Q&A sessions as an additional support platform during the Employer Filing Season. These sessions allow for real-time engagement, where common questions can be answered and guidance given to support accurate submissions. More information on topics, dates, and times will be communicated soon. Employers are encouraged to follow official SARS social media channels and visit www.sars.gov.za for updates.

How to Fulfil Your Tax Obligations (before You Submit)

Before submitting your EMP501, submit any outstanding monthly declarations (EMP201) and annual reconciliations from prior periods (where applicable); settle any payments due. This helps reduce the risk of rejection, penalties, and interest charges.

Submission Channels

Employers must use the appropriate SARS channels for submission:

• • e@syFile™ Employer: Employers with more than 50 employees
  • SARS eFiling or e@syFile™ Employer: Employers with between one and 50 employees, as well as employers who are still registered but have no employees, are required to submit the Employer Annual Reconciliation Declaration (EMP501). Where an employer has no employees and has not requested suspension or deregistration, a nil reconciliation must be submitted. Employers who no longer have employees may use SARS eFiling to request deregistration.

Check the Status of Your Submission

To ensure that an EMP501 has been successfully submitted to SARS, employers should monitor the status of their submission and consult the PAYE Dashboard to view the impact of the submission. Where a submission is incomplete or contains data errors, it is regarded as not successfully submitted, which may result in delays and non‑compliance.

Non-compliance Penalties and Offences

Submitting an incomplete EMP501 or submitting an EMP501 after the due date may result in administrative penalties. It is also a criminal offence for an employer wilfully or negligently to fail to meet prescribed obligations, including the submission of required declarations and the issuing of employee tax certificates within the specified periods.

More Information

Further details regarding technical clinics and social media live Q&A sessions will be communicated through official SARS channels.

• 20 March 2026 – Budget 2026 Frequently Asked Questions
  

  Key Employment Tax & PAYE changes from Budget 2026: FAQs on the PAYE changes

• 16 March 2026 – Updated:  PAYE Employer Reconciliation BRS for 2026 / 2027

What has changed:

• • 2026 budget speech changes related to long service awards and compensation i.r.o. death during employment.
  • New source code for travel reimbursement related to the previous tax year.

• 12 February 2026 – PAYE Employer Reconciliation BRS for 2026 / 2027

What has changed:

• • New fields were added to prevent duplicate registrations using the ITREG process
  • Validation and/or description changes to some existing source codes.
• 30 January 2026 – Frequently Asked Questions (FAQs) on Income Tax Reference Number (TRN) Submission Requirements
  • With effect from the 2026 reconciliation (EMP501) period for employers, EMP501 submissions without required TRN’s will not be accepted by SARS. See the frequently asked questions. 

• 15 September 2025 – Employer Interim Declarations (EMP501): 22 September 2025 to 31 October 2025

  SARS is committed to enabling government to build a capable state to advance the wellbeing of all South Africans. Employers play a vital role in this effort. Your commitment to tax compliance directly supports the country’s economic development and growth.

  As we approach the Employer Interim Reconciliation period, SARS is dedicated to giving clarity and certainty to make it easy to meet your obligations. This letter helps you navigate the upcoming reconciliation process.

  Employers’ Interim Reconciliation Declarations Is Part of Filing Season

  The Employer Interim Reconciliation submission period is from 22 September to 31 October 2025. During this time, all employers in the private and public sectors must reconcile their declarations for the first six months of the reconciliation year (1 March 2025 to 31 August 2025) and submit these on eFiling or e@syFile™ Employer. Employers with less than 50 employees may use eFiling.

  To submit a correct and complete reconciliation, your EMP501 must reflect:

  • PAYE, UIF, and SDL values from your previously submitted EMP201 returns, which will prepopulate in the EMP501. Where these values differ from the interim IRP5/IT3(a) certificates generated, employers must amend the prepopulated figures to the correct amounts.
  • Payments made during the period (excluding any penalties and interest); and
  • Accurate payroll information together with the IRP5/IT3(a) tax certificates for the period 1 March 2025 to 31 August 2025.

   Key Changes for 2025

  • Software update: use the new e@syFile. For the 2025 Employer Interim Reconciliation, the e@syFile Thin Client is now the primary submission channel for all employers. The “Flex” version is being phased out and can no longer be used for submissions, except for enquiries about historic data. Employers are encouraged to use the “Retrieve Certificate Detail” function to transfer certificate data from e@syFile Flex to e@syFile Thin Client. A step-by-step guide is available on the SARS website to assist with this process.
  • Business Requirements Specification (BRS) updated to version 24.0.2. This update introduced new source codes, changes to validation rules, and amendments to some source code descriptions. Employers and payroll administrators are encouraged to review the updated BRS to ensure their payroll systems and submissions are fully compliant with the latest requirements.

  Enforcement of Income Tax Numbers

  From the February 2026 employer filing season, Income Tax numbers will be strictly enforced in e@syFile™ Employer. Employers will no longer be able to submit reconciliations without valid Income Tax numbers for all employees. Please refer to BRS – PAYE Employer Reconciliation for 2025 / 2026 for the latest rules.

  To prepare:

  • Use the ITREG/BundleReg process on eFiling or e@syFile™, the Tax Reference Number Enquiry Service on eFiling, or visit a SARS Service Center (with an appointment) to register or request employees’ numbers.
  • Use Tax Reference Number (TRN) Enquiry Services on eFiling
  • Individuals can register or retrieve their own tax numbers on the SARS website under the “Individuals” section.

  Failure to comply will result in administrative penalties. Employers are urged to take proactive steps now to avoid delays in submissions, rejection of reconciliations, or penalties being applied.

  Submission Channels

  To make the reconciliation process easier, SARS provides different submission options for different-sized employers.

  • Employers with 50 or fewer employees can use either SARS eFiling or e@syFile™ Employer. If the employer has 50 or fewer IRP5/IT3(a) certificates, a tax-certificate file can be generated from the payroll system and this file can be imported into SARS eFiling.
  • Employers with 50 employees or more are required to use e@syFile™ Employer to file their EMP501 declarations.
  • Employers with five or fewer IRP5/IT3(a) certificates can visit their nearest SARS Service Centre, where a SARS agent will help capture the EMP501 and related certificates. Please remember to book an appointment before visiting a SARS Service Centre.

   Accuracy and Timely Filing Are Critical

  Submitting accurate declarations on time leads to a smooth reconciliation process and helps avoid unnecessary penalties, such as:

  • Possible penalties and interest for incorrect calculations. Incorrect calculation of the monthly PAYE liability could result in the imposition of both penalties and interest. This includes corrections made on the EMP501 reconciliation, because any shortfall is attributed to the last month of the reconciliation period.
  • Late submission penalties. Employers must submit an accurate EMP501 using e@syFile™ Employer or SARS eFiling by 31 October 2025 to avoid penalties.

  Consequences of Non-compliance

  Failure to comply with reconciliation requirements carries serious consequences:

  • Late submission of an EMP501 will result in administrative penalties equal to 1% of your annual PAYE liability. This penalty increases by 1% for every month the return remains outstanding, up to a maximum of 10%.
  • ETI employers with unused ETI will forfeit the ETI for non-submission or where the employer has a non-compliant status.
  • Employers who wilfully or negligently fail to submit EMP201 or EMP501 returns will be guilty of an offence. Upon conviction, they will be liable for a fine or imprisonment for up to two years.

   What Constitutes a Criminal Offence?

  Employers will face a fine or imprisonment for up to two years if they:

  • Fail to deduct employees’ tax (PAYE) from remuneration or fail to pay the deducted tax to SARS within the prescribed period;
  • Do not deliver IRP5 or IT3(a) certificates to employees or former employees within the prescribed deadlines; or
  • Use employees’ deducted tax for purposes other than paying the correct amount to SARS.

  Remember to Check Your Submission Status

  Employers must check the status of submissions regularly after submission to ensure that their EMP501 was correct and accurate when filed with SARS. The PAYE Dashboard should also be consulted. This step offers employers certainty that they have no outstanding obligations.

  More Information

  For  more information about completing manual certificates, employers can go to the e@syFile™ Employer User Guide or access the Step-by-Step Guide to the Employer Reconciliation Process.