|
| Table of Contents |
| Should you require any further detail on any of these topics, please feel free to contact us. |
| Top of Page |
| |
1. 2019 Budget and Tax Highlights
|
| Author: Jonathan Aitken |
We will be going through the budget in more detail and will hold our annual tax seminars in due course (dates to be announced) when we have had time to consider the practical application of new rules on payrolls and employers.
In the interim, the key highlights and overview of tax changes are obtainable from Treasury using the following links:
• Budget Highlights
• Tax Guide 2019
• Tax Legislative Changes
One of the positive things to see is that SARS intends resurrecting the large business centre with a hope to start this again in April 2019. They have also emphasised their commitment to improving their IT infrastructure.
Other relevant highlights are the following:
Employment Tax Incentive
In 2018, Government extended the employment tax incentive by 10 years. In addition, the eligible income bands will be adjusted upwards to partially cater for inflation. From 1 March 2019, employers will be able to claim the maximum value of R1 000 per month for employees earning up to R4 500 monthly, up from R4 000 previously. The incentive value will taper to zero at the maximum monthly income of R6 500.
Medical Tax Credits
To generate additional revenue of R1 billion in 2019/20, there will be no change in the monthly medical tax credit for medical scheme contributions.
Fuel Taxes
South Africa has three main fuel taxes that apply to petrol, diesel and biodiesel: the general fuel levy, the customs and excise levy and the RAF levy. These levies fund general government expenditure, support environmental goals and finance the RAF. From 5 June 2019, a carbon tax of 9c/litre on petrol and 10c/litre on diesel will become effective. Diesel refunds cannot be claimed against this tax. The general fuel levy will be increased by 15c/litre for petrol and diesel from 3 April 2019. The increase is slightly below inflation. Government also proposes to increase the RAF levy by 5c/litre from 3 April 2019. |
| Top of Page |
| |
| 2. ConCourt Ruling |
| Author: Nicky Hardwick |
An Employee is not entitled to make representations prior to a suspension.
On 19 February 2019, the Concourt ruled in Long v South African Breweries that it is not a requirement for an employer to allow an employee to make representations prior to a suspension where the suspension is precautionary and not punitive. In reaching this conclusion, the ConCourt considered the fairness of the suspension and whether the employee is prejudiced in doing so. |
| Top of Page |
| |
| 3. COIDA Maximum Amount of Earnings |
| Author: Jonathan Aitken |
Department of Labour published Government Gazette notice no. 42092 on 7 December 2018 with respect to the increase of the maximum amount of earnings on which the assessment of an employer will be calculated. The effective date is 1 March 2019.
The prescribed amount under Section 83(8) of the Compensation for Occupational Injuries and Diseases Act No 130 of 1993 (COIDA) has been increased to R458 520 per annum. |
| Top of Page |
| |
| 4. UIF Changes |
| Author: Jonathan Aitken |
Claiming When Losing a Portion of Earnings / Contributors to Nominate a Beneficiary / Domestic and Small Employers to Report and Pay Annually
The Minister of Labour has made the following material changes to the regulations in the Schedule, as published in Government Gazette 42140 No R 1434:
| • |
A "small enterprise" definition has been added to the regulation as contemplated in section 1 of the National Small Enterprise Act, 1996 (No. 102 of 1996). |
| • |
The UI Amendment Act added section 12(1B) to the Unemployment Insurance Act to provide that a contributor who loses a portion of his income due to reduced working time is entitled to benefits (despite still being employed) if the contributor's total income falls below the benefit level that the contributor would have received if he had become wholly unemployed. |
| • |
Contributors may nominate a beneficiary by submitting the new nomination form UI 53 to the Fund immediately on commencement of employment. If a contributor did not, before his or her death, complete the nomination form at the commencement of new employment, the Fund must accept a nomination form completed at the previous employer as valid. |
| • |
Employers must provide the Commissioner with the information in terms of their employees by submitting the declaration electronically or by completing form UI 19. |
| • |
Domestic and small enterprise employers may declare employees and contributions annually provided that the contributor's services are not terminated in which case the declaration must be done on termination. |
| • |
Forms UI 2.1, 2.2, 2.3, 2.4, 2.5, 2.6, 2.7, 3, 4, 5, 6A and 19 have been changed. Examples of the forms included in Government Gazette No. 42140. |
| • |
Form UI 53 (beneficiaries) has been added by the regulation. |
|
| Top of Page |
| |
| 5. COIDA |
| Author: Jonathan Aitken |
Return of Earnings Audit / Employer Registration / Application for Change of Nature of the Business
Return of Earnings Audit
Government Gazette No 42113 No 1385 was published to inform employers that the Compensation Fund may select an Employer's Return of Earnings (ROE) to an audit if an employer's ROE was referred due to the following reasons:
• Credit assessment or/and
• A considerable decrease in the amount of Return of Earnings (ROE) declared from prior
years
The following supporting documents will be required:
• Affidavit (Reason for variance / Credit assessment)
• Audited or Independently Reviewed Annual Financial Statements
• Detailed Payroll Report
• SARS EMP 501 / Tax Clearance
• Manual Return of Earnings
• Power of Attorney (Consultants, Attorney or any person appointed by an employer)
To view the official publication, please follow the link.
COIDA Employer Registration Form
Government Gazette No 42113 No 1386 was published to inform employers of the prescribed Employer Registration Form in respect of an employer's obligations to register with the Compensation Commissioner and to furnish him with particulars.
To view the official publication, please follow the link.
COIDA Application for Change of Nature of the Business
Government Gazette No 42113 No 1387 was published to inform employers of the requirements for the change of subclass and nature of business activities.
A business is classified according to the nature of industry the employer is engaged on. To change the nature of business, the following is required:
An affidavit with the following information:
• Detailed description of the nature of business activities.
• Duties of employees.
• Any other information which will contribute to the appropriate classification of the
business activities.
Documents required depending on the type of business:
• Proof of registration certificate with Companies and Intellectual Property Commission
(CIPC) in respect of business entity, close corporation or company.
• Letter of authority in respect of the trust.
• Proof of registration certificate with the Department of Social Development in respect
of Non-Profit Organisations
• Certified copies of Director's ID in respect of Companies
• Certified Copies of ID of Members in respect of a Close Corporation
• Certified copy of ID in respect of a Sole Owner
• Proof of SARS registration
• Proof of SARS Tax Clearance Certificate
Reasons for the change in nature of business can be due to the following:
The nature of a business changed (sometimes this happens gradually - over years) and the business is now classified in the wrong risk category. It could also be that the company was incorrectly classified from the beginning.
The change in business activities and re-classification of business entity will be effective from the date of receipt of request by the Compensation Fund.
To view the official publication, please follow the link. |
| Top of Page |
| |
| 6. Employee New PAYE Business Reporting for Employer Filing Season |
| Author: Jonathan Aitken |
Effective September 2019
SARS published the tax certificate specification document on 21 January 2019.
The document specifies the requirements for the generation of an import tax file for the annual as well as the interim submission. The requirements in this version of the BRS will become effective from September 2019 PAYE interim reconciliation period.
The details of the changes are highlighted in green in the BRS.
To access the new BRS, follow the link. |
| Top of Page |
| |
| 7. HRTorQue Now Offering VIP and Psiber Payroll Support |
| Author: Jonathan Aitken |
We are pleased to announce that HRTorQue now has the resources and capability to offer a support service to clients who wish to run their own payrolls on Sage VIP or Psiber, but who need help with material changes.
Our team are available to help with:
• Payroll Setup
• IRP5s and EMP501 Reconciliations and Submissions
• Report Setup
• Package Changes, e.g. medical aid price increases; new income/deductions |
| Top of Page |
| |
| 8. Contact HRTorQue |
Durban
Phone: 031 564 1155 • Email: [email protected] • Website: www.hrtorque.co.za
Address: 163 Umhlanga Rocks Drive, Durban North, KwaZulu-Natal
Johannesburg
Ground Floor, West Wing, 6 Kikuyu Road, Sunninghill, 2191
Cape Town Office
Ground Floor, Liesbeek House, River Park, Gloucester Road, Mowbray, Cape Town, 7700
Bloemfontein Office
62 Kellner Street, Westdene, Bloemfontein
East London
24 Pearce and Tecoma Street, Berea, East London
Port Elizabeth
280 Cape Road, Newton Park, Port Elizabeth
Polokwane
125 Marshall Street, Polokwane
Nelspruit
Promenade Centre, First Floor, Suite 11A, Nelspruit |
 |
|
|
|
