Employment Tax Incentive: The Struggle Continues

Employment Tax Incentive: The Struggle Continues

Payroll / eTorQue, Tax

In 2016 when submitting ETI claims significant challenges were experienced with the SARS e@syfiling system. The SARS e@syfiling system reported validation errors on fields where validation checks were not required. SARS subsequently acknowledged the issue with the validation checks and outlined a process where the specific validation checks would be resolved if no other validation errors were identified.

However, in practice, despite the appropriate validation checks being met, we have received evidence of companies receiving notification from SARS that their ETI claims are not valid and that they owe the full ETI claim – in most instances these relate to substantial sums which these companies have not budgeted for. When SARS local branches have been contacted to try and resolve the problem they are unable to help and refer it to e@syfile who in turn are unable to help as they see it as a process issue.

The issue is very material not only given the sums involved, but also because it impacts companies’ ability to obtain a tax clearance certificate.

The Payroll Authors Group of South Africa (PAGSA) and other groups are campaigning on behalf of employers to resolve this issue. It is interesting given the sums involved that the issue has not been reported on in the press.