Two looming SARS deadlines (for 31 May 2016): Tax and ROE

by with No Comment department of labourLatest Payroll NewsSARS

Two looming SARS-related deadlines for 31 May 2016

1.  2016 Tax Year Submissions to SARS

The deadline for submission of EMP501 and Employee Tax Certificates, is the 31st May, Tuesday next week. Have you finished your submission to SARS yet? The SA Revenue website has this advice for employers:

“Employers are required to submit their Pay-As-You-Earn (PAYE) Employer Annual Reconciliations between 18 April and 31 May 2016 to SARS, confirming or correcting payroll tax amounts which were declared during the 2015/2016 tax period.

This year, employers are urged to accurately verify and update each employee’s personal and financial details before submitting their Annual Reconciliation Declaration (EMP501) and Employees Income Tax Certificates [IRP5/IT3(a)s] to SARS.

Should these details be incorrect on an IRP5 certificate, the employee will be unable to file his/her Income Tax Return for Individuals (ITR12) during Tax Season. Individuals will no longer be allowed to make any corrections to pre-populated IRP5 details on their returns.

In cases where details are incorrect, employees will have to revert to their respective employers who will need to make changes on the IRP5 and re-submit these to SARS. This process can be time consuming and it may become problematic for employees to file on time.

Employers play a very important part in the income tax cycle which effectively starts on 18 April with the submission of the annual reconciliations. We rely on your cooperation to make the submission of ITR12s later in the year as stress-free as possible for all involved. Need help? Call the SARS Contact Centre on 0800 00 7277.”

2. Return Of Earnings (ROE) to the Department of Labour

Essential document downloads and login link

COIDA ROE DEADLINE EXTENDED — The Department of Labour has announced that the 2015/2016 ROE deadline has been extended until 31 May 2016. Submissions commenced on the 1st April 2016.

  1. Download the Online Submission Guide (Common Errors and FAQs)
  2. Department of Labour’s LOGIN PAGE
  3. Department of Labour’s Information Slides
  4. Download the Instruction Manual

Any further questions, please contact Ian@Paymaster.co.za

 

Overview of the basics of employer tax

by with No Comment EmployersLatest Payroll NewsSARSTax

Overview of the basics of employer tax

By starting a business, you’re helping to create jobs, contributing towards skills development, and even inspiring other entrepreneurs.
But it’s important to get your SARS red tape right from the start if you want to avoid problems and penalties with the tax authorities later down the line. This overview sets out the basics of employer tax – an area where you have no margin for error.
As an employer, you must deduct taxes from employees, file a range of submissions to SARS, and supply your employees with IRP5 certificates that they will also submit to SARS. You must also register all employees for income tax – everyone who is formally employed needs to be registered with SARS.Declarations and forms to be submitted:

  • Monthly Employer Declaration (EMP201) – This form declares the following deductions: PAYE (Pay as You Earn), SDL (Skills Development Levy) and UIF (Unemployment Insurance Fund) contributions.
  • Employer Reconciliation Declaration (EMP501) – Twice a year you must file this reconciliation of all amounts paid to SARS on behalf of your employees. The next deadline is 29 May 2015 – don’t miss it!
  • Employee Tax Certificates (IRP5/IT3(a)) – You must provide these tax certificates to employees after each tax year, and they will submit them to SARS.
  • Cancellation of Tax Certificates (EMP601).
  • Adjustment to Annual Reconciliation (EMP701) – Where you need to make adjustments to past reconciliation and declarations, this is the relevant form.

Employers must submit their Monthly Employer Declaration (EMP201) by the seventh of each month. Then, you will usually submit an interim Employer Reconciliation Declaration (EMP501) in September-October for the six months from 1 March to 31 August. Your final annual EMP501 submission is done during April and May for the tax year 1 March to 28/29 February.

You will normally issue employee tax certificates once a year. Watch out for SARS announcements at the end of each tax year (end of February) to keep ahead of the annual submission dates.

Steps to follow

SARS no longer accepts paper-based declarations for companies with more than five employees. If you have more than 20 employees, you’ll do most of your reconciliations and declarations electronically using the e@syFile software or use the eFiling website if you have under 20 employees.

Remember:

  • Always use the latest version of e@syFile, since SARS will not accept data submitted using an old version of the software.
  • Backup your data before installing an upgrade of e@syFile to protect yourself against the risk of possible data loss during the upgrade process.

Compiling the PAYE data and submitting employers’ tax reconciliation declarations can be easy if you use the right tools – especially a reliable and efficient payroll software system – and keep track of new SARS requirements and legislative changes.

BY: MADELEIN VAN DER WATT

TAX SEASON 2014 FOR INDIVIDUALS

by with No Comment SARSTax
1 July marks the start of the Tax Season 2014 for Individuals.
The annual Tax Season is when you need to complete and submit an Income Tax Return (ITR12) to SARS.
During Tax Season, taxpayers need to submit an ITR12 (which is your Income Tax Return) so we can calculate your tax liability based on your declared income and the tax-deductible expenses incurred for the assessment year (1 March – 28/29 February), which may, in some cases, result in a refund.
The Tax Season runs from July to November every year and for provisional taxpayers who submit via eFiling, until January of the next year.
Here are some handy tax tips to help you easily and honestly submit your ITR12 on time:

Tax Tip #1

Who needs to submit an Income Tax Return (ITR12)?

Not everyone needs to file an ITR12.
Are you:
  • An individual (Provisional or non-provisional taxpayers)?
  • Who earns up to R250 000 for the full tax year?
  • From one employer (that’s your total salary income before tax) and
  • You don’t have a car allowance, the right of use of a company car fringe benefit or any other form of income (e.g. interest or rental income) and
  • Have no deductions that you want to claim for (for example like medical expenses, travel or retirement annuities)?

If you answered yes to all of the statements above, then you don’t need to submit a return.

Top Tip: Trusts are required to submit an annual Income Tax Return (IT12TR), as well.

Tax Tip#2

What do I need to complete my Income Tax Return (ITR12)?

When completing your ITR12, have your relevant material to hand. You may need to refer to these, while completing your return; however, you must not submit them to SARS.
Top Tip: Keep your relevant material (supporting documents) safely in your possession for at least five (5) years in case SARS needs access to them in future.
  • Your Employee Tax Certificates [IRP5/IT3(a)s] which you will get from your employer/pension fund
  • Medical certificates as well as documents for amounts claimed in addition to those covered by your medical aid.
  • Pension and retirement annuity certificates
  • Travel logbook (if you receive a travel allowance or use a company car)
  • Tax certificates that you get from investment income [IT3(b)]
  • Completed Confirmation of Diagnosis of Disability (ITR-DD), where applicable. See more information on our Tax and Disabilitywebpage.
  • Information relating to capital gain transactions, if applicable
  • If you have signed up to our Voluntary Disclosure Programme (VDP) then your VDP agreement between yourself and SARS for years prior to 17 February 2010, where applicable
  • Financial statements, e.g. business income, where applicable. You may for example have a property which you rent out, so you will need to declare this income.
  • Any other documentation relating to income you received or deductions you want to claim.
Remember if you need to change your banking details additional relevant material (supporting documents) may be needed.
Top Tips:

Tax Tip#3

How to submit your ITR12?

  • If you want to file from a mobile device, download our Smartphone App .
  • If you need help while eFiling online, you can access Help-You-eFile, a free service available to all eFilers. Simply click on the Help-You-eFile icon on your eFiling login page or at any point during your eFiling session to be connected, quickly, to a friendly SARS agent who will help you to complete your ITR12.
  • You may ask a SARS branch agent to file it electronically for you. Find your nearest SARS Branch.
  • Post it or put it in the drop box at a SARS branch.

Top Tip: See a list of the SARS branches that will be open on Saturdays from 8:00 – 13:00 during 5 July until 27 September 2014 to help taxpayers submit their ITR12.

Tax Tip#4

Important Due Dates for Tax Season 2014

Depending on how you submit your Income Tax Return (ITR12) to SARS, be sure you know the due date:
  • By post or dropping it off in a SARS drop box – 26 September 2014
  • Electronically at a SARS branch (provisional and non-provisional) – 21 November 2014
  • Non-provisional taxpayers who use eFiling – 21 November 2014
  • Provisional taxpayers who use eFiling – 30 January 2015.

Tax Tip#5

Beware of scams

  • SARS will never ask for your banking or personal details in any communication that you receive via post, email, phone or SMS
  • SARS won’t send you hyperlinks to other websites – even those of banks.
Top Tip: Beware of people who offer to complete your tax return for you and who promise they can get you a refund. See a list of scams and to report any suspicious activity.

Tax Tip#6

Use a registered Tax Practitioner

Please remember that all Tax Practitioners are now required to be registered with a recognised controlling body (RCB) as well as with SARS.
 You can ask your Tax Practitioner for their SARS and Controlling Body registration details to verify that you are working with a registered and reputable practitioner.
Top Tip: You can check if they’re registered with an accredited professional body and you’ve got better protection if they belong to aregistered practitioner association.
 A person who is not registered with a RCB and who prepares tax returns on your behalf will only be able to perform limited functions. They may not charge you and they may not submit the return on your behalf.
In order to submit a return completed by someone who prepares your ITR12:
Top Tip: Even though a Tax Practitioner is completing and submitting your ITR12 on your behalf, the responsibility still rests with you as the taxpayer to make a true declaration and for any outstanding returns, payments and penalties.

Fixing a duplicate or incomplete employer Submission to SARS

by SARS

During the recent Employer Annual Reconciliation period we noticed that certain employers experienced problems due to the fact that duplicate or incomplete reconciliation declaration submissions were made on e@syFile™ Employer.

What is considered a duplicate submission?
A submission is considered to be a duplicate once the verification has been completed and it is determined the information about to be re-submitted to SARS is identical to the previous submission made (e.g. the information contained in the Employer Reconciliation Declaration (EMP501) and the Employee Tax Certificates [IRP5/IT3(a)s] is the same as the previous submission).

What may cause a duplicate submission?
A duplicate submission may occur when an employer selects “Via SARS Branch (Electronic medium)” to generate the IRP5/IT3(a)s to check the correctness of the submission before submitting it to SARS.

What is considered an incomplete submission?
A submission is considered to be incomplete where all certificates have not been received.

What may cause an incomplete submission?
An incomplete submission may occur when an employer:

1)selects “Via SARS Branch (Electronic medium)” to generate the IRP5/IT3(a)s to check the correctness of the submission before submitting it to SARS.Once the IRP5/IT3(a)s have been checked, and changes are made (where necessary), the employer then once again, submits the information to SARS by selecting “Via the Internet (eFiling Login Required)” which results an incomplete submission.

2) As e@syFile™ Employer only submits the updated EMP501 and/or new or amended IRP5/IT3(a)s, the initial information was not submitted to SARS, therefore resulting in incomplete information being submitted.

How do I fix this problem for either duplicate or incomplete submissions?
• Logon to e@syFile™ Employer
• Enter your login details
• Once on the home screen, select “Utilities” in the left hand side menu
• Select “Full Resubmission Request”, this is the last option in the menu
• Select the employer, from the drop-down list, for which the re-submission must be made
• Click “Request”
• A pop-up message will appear – please read this carefully
• Click “Yes” to continue
• You will now be at the reconciliation declaration screen.
• Capture your reconciliation declaration information and submit to SARS.

Why does SARS do a verification before each submission?
In order to minimise duplications and improve the response time to employers on the outcome of their submissions, SARS does a verification each time an EMP501 and/or IRP5/IT3(a)s are submitted for processing. Where a duplicate is identified, this will result in an error as duplicates are not allowed for re-submission.
Once the verification of the IRP5/IT3(a)s has been completed and no changes are required, the employer then once again, submits the information to SARS by selecting “Via the Internet (eFiling Login Required)” which results in a duplicate submission.
The re-submission will not be allowed, as the information is identical.

Top Tips:
• Be sure that when selecting “Submit to SARS” and completing the process, the information is ready and intended for submission to SARS.
• The full resubmission request function should only be used in exceptional circumstances as this will delay the processing of the reconciliation declaration submission.
Validation rules have been included on the Skills Development Levy (SDL) and Unemployment Insurance Fund (UIF) reference numbers. Therefore employers are advised:
• Where an entity is NOT registered for Pay-As-You-Earn (PAYE), SDL and UIF with SARS but still uses e@syFile™ Employer to submit their reconciliation declarations, their Income Tax reference number must be completed in the PAYE reference number field on the employer demographics page (EMPLOYER ADMIN – View/Edit/Change), but should remove the information from the SDL and UIF fields. UIF deductions should not be included when completing the reconciliation declarations, as these amounts are paid directly to the Department of Labour.
• Where an entity is registered for SDL and UIF, but not for PAYE and still uses e@syFile™ Employer to submit their reconciliation declarations, their Income Tax reference number must be completed in the PAYE reference number field on the employer demographics page (EMPLOYER ADMIN – View/Edit/Change) and must ensure the correct reference numbers are completed in the SDL and UIF fields.

Administrative Penalties for PAYE non-compliance

by with No Comment Employee TaxPAYEPenaltiesSARS

This notice appears on the SARS website.
A number of Employers have still not complied with 3 June 2011 submission for the annual Employer Reconciliation Decleration and as a result, SARS will now, impose penalties in relation to PAYE transgressions, allowed in terms of the 4th schedule of the Income Tax Act no 58 of 1962.

For PAYE Tax, the administrative penalty will be imposed:

Where the employer:

1) Does not submit the annual EMP501 reconciliation

2) Does not pay the total PAYE amount that was declared in the Employee Tax Certificates[IRP/IT3(a)] over to SARS, even where the return has been submitted on time, andSubmits incorrect, incomplete or inaccurate data within the IRP/IT3(a) certificates, evenwhere the return has been submitted on time.

Then  a percentage based penalty equal to 10% of the total PAYE paid for the period (this is a once off penalty), and there will be an adjustment of the penalty, calculated on a percentage sliding scale

based on the date that the non-compliance was remedied over a period of 9 months, e.g if the

remedied in the first month from imposition, then the 90 % of the 10% penalty will be waived.