Completing and submitting Employer Declaration

What is Employees’ Tax?

EMPLOYEES’ Tax refers to the tax required to be deducted by an employer from an employee’s remuneration paid or payable.

An employer who is registered or required to register with the South African Revenue Service (Sars) for Pay-As-You-Earn (PAYE) and/or Skills Development Levy (SDL) purposes, is also required to register with Sars for the payment of Unemployment Insurance Fund (UIF) contributions to Sars.

An employer needs to submit a reconciliation showing the details of the total amount of Employees’ Tax [PAYE, SDL, UIF and/or Employment Tax Incentive (ETI)] deducted or withheld as well as the details of Employee Tax certificates [IRP5/IT3 (a)’s] issued during the tax year.

The Monthly Employer Declaration (EMP 201)

The amounts deducted or withheld by the employer must be paid to the South African Revenue Service (Sars) on a monthly basis.

The Monthly Employer Declaration (EMP201) declares the total payment together with the allocations for PAYE, SDL, UIF and/or ETI.

A unique payment reference number (PRN) will be pre-populated on the EMP201, and will be used to link the actual payment with the relevant EMP201 payment declaration.

How and when should it be paid?

It must be paid within seven days after the end of the month during which the amount was deducted. If the last day for payment falls on a public holiday or weekend, the payment must be made on the last business day before the public holiday or weekend.

The Employer Reconciliation Declarations (EMP 501, EMP601 and/or EMP701)

Employers need to submit their reconciliation by the date published in the Government Gazette.

Employers are required to submit an accurate Employer Reconciliation Declaration (EMP501), Employee Tax Certificates [IRP5/IT3(a)s] to be issued and, if applicable, a Tax Certificate Cancellation Declaration (EMP601) for the:

l Interim period – which is for the six month period March 1 to August 31
l Annual period – which if for the full year March 1 to February 28/29.

The Employee Tax Certificate [IRP5/IT3 (a)]

An employer must issue an employee with an IRP5/IT3 (a) where remuneration is paid or has become payable. The IRP5/IT3 (a) discloses the total employment remuneration earned for the year of assessment and the total deductions.

Certificates are only issued for the full year March 1 to February 28/29. For the interim period certificates are only issued when marked ‘final’.

* The final submission periods are subject to business requirements/ readiness and calendar working day dates. Final confirmation will be communicated at the time of the relevant submission period.

If you require help completing your EMP 201s, or require a tax practitioner, please contact any one of our Nexia SAB&T branches nationally.

Please note that the above is for information purposes only and does not constitute tax advice. As each individual’s personal circumstances vary, we recommend they seek advice on the matter.

Please note that while every effort is made to ensure accuracy, Nexia SAB&T does not accept responsibility for any inaccuracies or errors contained herein. If you are in doubt about any information in this article or require any advice on the topical matter, please do not hesitate to contact any Nexia SAB&T office nationally.