PAYE and non-residents

Employment income is generally taxed where the services are physically exercised. The place of contract conclusion, where the employer is based and where the remuneration is paid is irrelevant in determining the taxation of employment income. This principle is supported by South African legislation and case law. Income earned from South African employers for services […]

Rescission of judgments by SARS: Barnard Labuschagne Inc v SARS

The judgment deals with an application for rescission of a judgment by Barnard Labuschagne (Applicant), where SARS took judgment under the provisions of chapter 11 of the Tax Administration Act (TAA). SARS filed a certified statement in terms of Section 172 of the TAA with the Registrar of the Court, setting out an amount of […]

For how long can your taxes haunt you?

In terms of section 99 of the Tax Administration Act, 28 of 2011, an assessment may not be made three years after the date of an original assessment by the South African Revenue Service (SARS), or in the case of a self-assessment by a taxpayers (such as in the case of a Value-Added Tax return), […]

Your payroll administration questions answered

As payroll administrators ourselves, we encounter a few frequently asked questions that employers, business owners or those responsible for payroll administration within organisations struggle with.  Below we have a detailed answer for you on these burning questions you are facing.  We hope that you find them insightful. Question: At what stage is an employer required […]

Changes regarding payroll taxes

The South African Revenue Service (“SARS”) has recently made changes with regards to the management of payroll taxes in order for employers to more effectively manage their own accounts by way of a number of functions and tools. SARS states that the aim of these changes is to allow employers to ensure that all their […]

FIXED AND REIMBURSIVE TRAVEL ALLOWANCES

When determining the best remuneration package for travelling employees, South African employers and employees are continuously considering the benefits between a travel allowance, a reimbursive travel allowance or both. For this purpose, the employees’ tax (“PAYE’’) and income tax consequences of these two allowances are set out in more detail below. A travel allowance is […]

EMPLOYEES’ TAX (PART I): PERSONAL SERVICE PROVIDERS

For there to be an obligation for PAYE to be withheld is typically dependent on three elements being present. These elements are all defined in the Fourth Schedule to the Income Tax Act[1] and include the presence of an employer, an employee and the payment of remuneration. No employees’ tax can be charged if one […]

Important Notification: Employer Annual Reconciliation Due

Employers should be aware that Employer Annual Reconciliation submission due date is fast approaching. If the relevant deadlines are missed, certain penalties will apply. When should it be paid? The Employer Annual Reconciliation starts on 1 April 2018 and employers have until 31 May 2018 to submit their Annual Reconciliation Declarations (EMP501) for the period 1 March 2017 to […]

THIRD PROVISIONAL TAX PAYMENTS

Provisional taxpayers are required to submit two returns annually: one after six months from the start of the relevant year of assessment, and again one on the last day of the relevant tax year.[1] Since provisional taxpayers are taxpayers who earn income in a form other than salaried income (and from which PAYE is deducted […]

THE “IN DUPLUM” RULE AND TAX LEGISLATION

The “in duplum” rule originated from the South African common law and has been applied through South African case law for over 100 years. This common law rule specifies that interest on a debt will cease to run (or accrue) when the total amount of arrear interest equals the amount of the principal debt outstanding. […]