Avoid Penalties By Being Prepared For The SARS Interim PAYE Reconciliation Period
01 August 2013
Posted by: Author: Dave McDermott
Author: Dave McDermott (Copywise)
The bi-annual company tax return season
opens on 1 September 2013 and it makes sense for companies to prepare their
mandatory information in August to avoid SARS e@syFile rejections and late
All South African companies are required
to reconcile and submit PAYE, UIF, SDL contributions for the period of 01
September 2013 – 31 October 2013.
"Companies have about four weeks to
prepare their submission information and update their payroll systems before
performing their last payroll run in August,” says Philip Meyer, technology
director at Sage Pastel Payroll &
"It is critical for companies to ensure
that they download and install the latest version of SARS e@syFile before
reconciling. Companies are advised to
backup their current information on their computers prior to installing a new
version of e@syFile Employer, as the installation may delete the current
Another important requirement for
companies is to comply with new legislation pertaining to employees making use
of company vehicles leased by their employer. Meyer says the fringe benefit
value is the rental contract plus the fuel cost for the month. However, the
rental contract must be classified as an operating lease.
Income tax reference numbers are another
important element in returns. Companies can only submit tax certificates to
SARS if each employee has an income tax reference number. Submissions in which
one or more tax certificates do not have the mandatory individual income tax
reference number specified will not be accepted by SARS.
Companies using an automated payroll
software solution can obtain employee tax reference numbers via the bulk ITREG
functionality and the e@syFile Employer system to simplify the reconciliation.
Attention should also be paid to new
source codes in the event that the employer pays a lump sum to the family of a
deceased employee. The first R300 000 of the lump sum is tax free but the
portion exceeding R300 000 is taxed by
way of a SARS directive and the lump sum must be reported against code 3922 and
the PAYE on the lump sum must be allocated to code 4115.