We do everything... so you don't have to.
Cell: 071 353 7617
1. When must I register for VAT?
A business must register as a VAT vendor at the beginning of the month in a 12 month cycle where it is evident that the business will reach R 1 000 000.00 (excluding VAT) in services or sales income, or at the end of the month where the business has already reached R 1 000 000.00 (excluding VAT) in services or sales income. Also note that a business can voluntarily register as a VAT vendor if it is evident that the annual services or sales income will exceed R 50 000.00 (excluding VAT), this will have to be proven upon registration.
2. When is VAT payable and how does it work?
The submission dates vary as per your registration, most commonly vendors are registered on odd (March, May, July, September, November and January) or even months (April, June, August, October, December and February). If you have been registered on an odd month, your submission date will be on the 25th of the month following the end of the 2 month period in which VAT is calculated, for example: VAT period February - March will be payable by the 25th of April or the last business day preceding the 25th. If you have been registered on an even month, you submission date will be on the 25th of the month following the end of the 2 month period in which VAT is calculated, for example: VAT period March - April will be payable by the 25th of May or the last business day preceding the 25th. Also note that if you submit via efiling the submission date will be the last business day of the month. It is very important to make sure you submit and make a payment on the prescribed date as SARS will levy penalties and interest on overdue returns.
VAT is currently (2017) levied at 14% of all allowable income and expenditure and is calculated over a two month period in which your Vatable expenses are deducted from your Vatable income and the difference is either due to SARS or refundable by SARS.
3. When must I register for PAYE?
If you pay any employee above the current (2017) annual remuneration of R 75 864.00, you must register for PAYE and make the monthly payments to SARS in due time. The payment dates are before or on the 7th of each month, it is also important to note that if the 7th falls on a weekend or public holiday, the payment should be made on the last business day preceding the 7th. It is very important to make sure you submit and make a payment on the prescribed date as SARS will levy penalties and interest on overdue returns.
4. When do I need to submit my IRP5/IT3a?
Currently (2017) it is necessary for an employee to submit his or her IRP5 if he or she earns R 75 864.00 annually. It is however not necessary to submit your IT3a with SARS if you only received one IT3a from one employer, if it so happens that you received more than one IT3a, you will need to submit it with SARS. The submission dates start 1 July each year and end 30 November each year. It is important to note that efiling user dates and manual submission dates differ as follows:
E-filing: End of January the following year
Manual: End of November the current year
5. How does a medical aid claim work when submitting Individual Income Tax?
If your employer makes a part payment to your medical aid, a portion of that contribution is taxed. Currently (2017) the rebate per beneficiary is R 303.00 for the main member and the first dependent and R 204.00 for each dependent thereafter. The contribution made by the employee is fully taxable. It is important to note that you must have a valid Medical Aid Tax Certificate for the period in which you need to make your submission and it is important to note that you must keep record of all medical expenses your medical aid did not cover as this can also be claimed. However, you must ensure that all expenses have been recorded and claimed through the medical aid. Keep these invoices and documentation safe as SARS will likely want you to provide proof of medical expenses incurred.
6. When must I register for UIF?
It is required for any employer that employs 5 or more employees to register for UIF and register each employee within 7 days of employment with UIF. This is a statutory deduction from your employee’s salary at 1% and an obligated contribution from the employer of 1%. Which means a total of 2% of the employee’s salary should be submitted either manually or via e-filing on the 7th of each month. When not registered for PAYE, you must submit a UI19 on a monthly basis and make a payment to the Department of Labour. If an employee works less than 24 hours a month it is not necessary to register them with UIF or to deduct from their salary.
7. What is SDL?
The Skills Development Levy (SDL) is an obligatory levy that comes into effect when a business’ annual payroll exceeds R 500 000.00. This a levy that is only payable by the employer at 1% of each employee’s wages/salary that is payable with your PAYE and UIF submission on the 7th of each month. This levy is utilized by the Government to encourage employers to hire less qualified individuals and provide training. A portion of the levy is reclaimable with the necessary registration to the Sector Education and Training Authorities (SETA’s) and the Work Place Skills Plan that needs to be implemented. The Skills Development Levy was implemented, among other things, to lift up the previously disadvantaged of Southern Africa.
8. Why has the Payroll function of a business become so difficult?
In South Africa we are faced with a lot of legislation brought in to aid the employees when unemployed, unskilled or who struggle to find work in a very demanding workplace. These deduction’s, coupled with Union memberships, Bargaining Council memberships and Tax obligations has made the process of paying employees very difficult and calls for a certain amount of education and experience. More businesses prefer to outsource this function, especially when they have a large workforce. With all the statutory, non-statutory deductions and conditions of employment, which differ from business to business and sector to sector, it has become very difficult to process salaries correctly. Since the workforce is the backbone of the company it is very important to do this correctly.
Monique Beets CTFAIcba(SA)