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Avoid SARS penalties by fulfilling your three employer tax obligations

by , 04 November 2014
As an employer, you have to do three things when it comes to your employees' taxes. This is a legal requirement. If SARS finds out you've neglected these duties, it will charge you serious penalties that can go up to 200%.

You can't afford to let this happen to your business.

And you don't have to!

Just fulfil these three employer tax obligations to stay on SARS' good side...

 

Three employer tax obligations you must fulfil to comply with tax law

 
1. Paying your employees' Pay As Your Earn (PAYE) tax
If you have full-time employees, it's your duty to calculate, withhold and pay over their PAYE.
 
You must work out their PAYE according to their salary amount. Then, each month, you must hand this over to SARS.
 
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2. Hand out employee tax certificates
You must give your employees their tax certificates each year. These certificates can either be the IRP5 or IT3(a) depending on the type of remuneration you pay your employees.
 
Check out this article to find out what deadlines you must stick to when it come to giving your employees their tax certificates.
 
3. Withhold fringe benefits tax
If you give your employees fringe benefits, it's your duty to work out the tax on these benefits and withhold it.
 
Remember, this tax is additional to your employees' PAYE and not included in it. 
 
Work out this tax based on the 3.5% rule. (Essentially, this means you must work out what 3.5% of the benefit's total value is to determine the fringe benefit tax on it).
 
Ensure you fulfil these three employer tax obligations so SARS doesn't charge your business penalties.
 
Check out the Practical Tax Loose Leaf Service for more on your tax obligations as an employer.
 


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