HomeHome SearchSearch MenuMenu Our productsOur products

Account for employee contributions correctly in four easy steps and avoid SARS penalties today!

by , 08 April 2013
Employee related expenses are significant for many companies. Calculate your employee contributions wrong and SARS'll jump at the chance to penalise you. But don't worry. There are four easy steps to follow to get your calculations right everytime. Let's have a look...


Employee related expenses are significant for many companies. Calculate your employee contributions wrong and SARS'll jump at the chance to penalise you. But don't worry. There are four easy steps to follow to get your calculations right everytime.

Let's have a look...

+++Do you know why Gail doesn't spend R10 000 a month on bookkeeping fees?+++

Gail is a GP who's just opened her own private practice. Because she's trying to save money on admin costs, she is doing her books herself.

She thinks: 'How hard can it be?' The answer: 'It's very hard unless you've got the right tools at your fingertips!'

The Practical Accountancy Loose Leaf is just one of those tools. With everything from checklists about how to prepare for an audit, to detailed explanations about financial statements, the Practical Accountancy Loose Leaf is your one-stop accountancy resource!

+++

Four steps you can follow to account for employee contributions correctly

There are four steps to account for employee costs and contributions correctly. Let's see what they are…

Step 1:Use control accounts in your general ledger to maintain control of your accounts. This will help you avoid errors.

Step 2: Create a monthly salary payslip, where you record the gross earnings and total income along with any deductions. Your accounting records will benefit from this kind of detail.


+++ Here's your chance to take the hassle out of tax, audit-proof your business and make the Receiver your friend! +++


Step 3: Record any amounts withheld by the employer. Keep track of amounts withheld. This will make it possible for you accurately show how much is debited from the total salary amount and what you've paid over to SARS.

Step 4: Determine the cost to company. The onus is on you to know exactly what your employees cost the company.For a more detailed look into these four steps, as well as an example,  turn to E 01 page 003 in your Practical Accountancy Loose Leaf Service.

Now that you have the basics on how to account for employees contributions correctly you'll never face penalties from SARS again. rvice. Not a subscriber? Sign up here today.

Until next time,



Philip Rosenberg

P.S My new client's previous 2 accountants, (for 19 years) did not declare or pay income/income tax to SARS. I really need advice on what to do here. Find the answer to this and other accounting and tax questions at our free Accounting and Tax Club


Related articles




Related articles



Related Products



Comments
0 comments


Recommended for You 

  Quick Tax Solutions for Busy Taxpayers – 35 tax answers at a glance



Here are all the most interesting, thought-provoking and common tax questions
asked by our subscribers over the last tax year – everything from A to Z!

To download Quick Tax Solutions for Busy Taxpayers – 35 tax answers at a glance click here now >>>
  Employees always sick? How to stop it today



Make sure you develop a leave policy to regulate sick leave in your company.

BONUS! You'll find an example of the leave policy and procedure in this report.

To download Employees always sick? How to stop it today click here now >>>
  Absenteeism: Little known ways to reduce absenteeism



This FREE e-report will tell you how you can reduce absenteeism in your workplace while avoiding the CCMA and without infringing your employees' labour rights.

To download Absenteeism: Little known ways to reduce absenteeism click here now >>>
  7 Health & safety strategies to save you thousands



Don't let a health and safety incident cost you one more cent. Implement these seven
strategies in your company today.

To download 7 Health & safety strategies to save you thousands click here now >>>