Compliance to SARS starts the day you as an employer start remunerating employees for services rendered. The employer is a designated agent of SARS and is responsible for withholding pay as you earn on behalf of the employee and all other associated/Statutory contributions. This not limited to the employee’s contribution but also includes any legislative company contributions.
The employer is also obligated to report to these instances in a prescribed format, and needs to be declared on a Bi and annually based cycle
Below are some quick references to assist an employer in complying to SARS requirements.
01 Prepare for SARS compliance before hiring your first employee
As a matter of urgency or prior to remunerating your first employee, even it being yourself, there are some prerequisites you must undertake.
You will need to register with SARS for income taxes and other compulsory contributions (UIF, SKILLS, COIDA).
The above relates to payroll compliance factors and values to be withheld and paid over to local authorities once registration / reference numbers are available.
02 Responsibilities as an Employer on Payroll Taxes
The employer is responsible to insure the following:
-Collecting appropriate information and documentation from employees on hire and any other time.
-Correctly calculating payroll taxes and withholding them from employees payslips
-Paying payroll taxes to SARS and other legislative authorities.
-Declaring values withheld in a prescribed format within relevant time frames.
03 How do I calculate Payroll tax deductions?
The employers first responsibility will be to get a comprehensive and trusted HCM platform that includes a compliant legislative calculation platform, as these platforms are recognized and approved by SARS.
LabourNet recommends the PSIber HCM platform although Excel seems to be all start up’s default tendency, the risk involved have seen many startup ventures come crashing down due to liabilities not accounted for not to mention prescribed formats and submission policies makes it impossible for the novice user to comply to.
04 When must Payroll taxes be paid to SARS?
All payments must be done before the 7th of every month.
And must be processed/done electronically via E filling (SARS website)
05 When do you as employer Submit and reconcile TAX, UIF and SDL
This process is done bi-annually and annually using the SARS easy file platform.
-EMP201 (TAX, UIF and SDL Monthly Reports) from March to August.
-EMP201 (TAX, UIF and SDL Monthly Reports) from March to February.
Reconcile to what was paid over to SARS and what is calculating on your Payroll tax system and submit your EMP501 (TAX, UIF and SDL Yearly Report)
For more information on the above topic, please contact the LabourNet Helpdesk at
0861 LABNET (0861 522638).
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