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Are you the representative taxpayer at your business? Here's what it means

by , 28 July 2014
As an accountant, do you understand what it means when you sign as the representative taxpayer on your EMP (PAYE) registration form? Most people don't! Let' s have a look at what it means to be a representative taxpayer...


What is a representative taxpayer?

If you're the representative taxpayer it means you're a natural person who resides in the Republic and:

1. You're the public officer for the company's income;
2. In respect of the income under your management, disposition or control, the agent of any
person; etc. (58 of 1962; Income Tax Act). This means if you're responsible for managing the payroll process and doing all the calculations you're seen as the representative taxpayer;
3.You're responsible for paying the tax liability of another person as an agent (Section 153 A, TAA);
4.You're a representative employer (so a company appointed to administer the payroll function for an entity (Schedule 4; Income tax Act); and
5. SARS can hold you personally liable for tax payable if you dispose of, or misuse the funds you're responsible for.

If you sign the EMP101 form as the representative taxpayer for a company, you're responsible to ensure the payroll taxes are proper and correct.

If you're no longer the representative taxpayer for your company, notify SARS!

In chapter P04 page 004 of your Digital Practical Accountancy Guide, we show you exactly how to notify SARS, as well as how to correctly account for monthly PAYE you submit to SARS, what SDL is and how to handle it correctly, what UIF is and how to handle it correctly and five other vital facts to SARS-proof your payroll.

Don't have your version of the Digital Practical Accountancy Guide yet? Click here to order it.
Until next time,
Henk Heymans
Editor-in-chief, Digital Practical Accountancy Guide

P.S: We've slashed 20% off the price of the Digital Practical Accountancy Guide! Click here for your copy.

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