SARS has recently published a notice stating that the IRP 3(a) form has been updated to comply with legislative changes.
These changes include:
- Two new directives reasons regarding ’employer owned policy proceeds’ were added:
- Taxable
- Exempt Section 10(1)(gG)
- The severance benefit reason has been enhanced to align to the Income Tax Act No. 58 of 1962 severance benefit definition, which means:
- The leave and pro-rata bonus must not be included as severance benefits as these amounts are only paid at the time of the termination of employment.
- It is important to note that these amounts are regular income, and must be included in gross income, and not as a severance benefit (termination) payments.
Should you have any questions in this regard please contact Dave Beattie on either 031 582 7410 or [email protected].