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Make sure you know these 5 MUST-HAVES when it comes to tax certificates

by , 06 November 2015
You MUST issue tax certificates to your employees! And they need to be correct.

An employee's tax certificate is proof he earned a certain remuneration, and he paid the required tax to the South African Revenue Service (SARS).

Getting these certificates wrong could lead to administrative penalties and a possible audit of your business.

As you can already see, tax certificates are very important. And having said that, here are 5 things you must know when it comes to tax certificates. So ensure you do the following:

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1.     If you pay any form of remuneration to an employee, you must give him an appropriate tax certificate.
 
2.     The certificate must be in a format SARS prescribes by SARS. You can use E@syFile software that SARS provides free of charge. Or, if you have 20 or fewer employees, you can use eFiling.
 
3.     The tax certificate must show the total remuneration. It must be broken down by the type of remuneration paid. This would include things like basic salary, overtime, etc.
 
4.     Any tax which is deducted from an employee's salary must be shown on the tax certificate.
 
5.     The tax certificate needs to be given to the employee within a specific period of time.
 
Remember you must declare all taxable benefits, your employees receive, on their tax certificates. This includes medical aid benefits, company car allowances and so on.
 
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