Paragraph 15 (Fourth Schedule) – Registration of employers

Posted on October 15, 2015December 6, 2017 by admin_kmos

15. REGISTRATION OF EMPLOYERS

(1) Every person who is an employer shall apply to the Commissioner in accordance with Chapter 3 of the Tax Administration Act for registration: Provided that where no one of such employer’s employees is liable for normal tax, the provisions of this paragraph shall not apply to such employer.

(2) ……….

(3) Every person who is registered as an employer shall within 14 days after ceasing to be an employer, notify the Commissioner in writing of the fact of the employer having ceased to be an employer.

(4) ……….

16. ……….

Paragraph 14 (Fourth Schedule) – Employer to keep records and furnish returns

Posted on October 15, 2015January 22, 2023 by admin_kmos

14. EMPLOYERS TO KEEP RECORDS AND FURNISH RETURNS

(1) In addition to the records required in accordance with Part A of Chapter 4 of the Tax Administration Act, every employer shall in respect of each employee maintain a record showing-

(a) the amounts of remuneration paid or due by him or her to such employee;

(b) the amount of employees’ tax deducted or withheld from the amounts of remuneration contemplated in item;

(c) the income tax reference number of that employee where that employee is registered as a taxpayer in terms of section 67; and

(d) such further information as the Commissioner may prescribe,

and such record shall be retained by the employer and shall be available for scrutiny by the Commissioner.

(2) Every employer shall when making any payment of employees’ tax submit to the Commissioner a return.

(3) Every employer shall –

(a) by such date or dates as prescribed by the Commissioner by notice in the Gazette; and

(b) if the employer ceases to carry on any business or other undertaking in respect of which the employer has paid or becomes liable to pay remuneration to any employee or otherwise ceases to be an employer, within 14 days after the date on which the employer has so ceased to carry on that business or undertaking or to be an employer, as the case may be,

or within such longer time as the Commissioner may approve, render to the Commissioner a return.

(4) ……….

(5) Unless the Commissioner otherwise directs, no employees’ tax certificate as contemplated in paragraph 13(2)(a) or (c) shall be delivered by the employer until such time as the return contemplated in subparagraph (3) has been rendered to the Commissioner.

[Subparagraph (5) added by section 22 of Act 4 of 2008, substituted by section 16 of Act 61 of 2008 effective on 29 August 2008 and section 13 of Act 23 of 2015 effective on 8 January 2016]

(6) If an employer fails to render to the Commissioner a complete return referred to in subparagraph (3) within the period prescribed in that subparagraph , the Commissioner may impose on that employer a penalty, which is deemed to be a percentage based penalty imposed under Chapter 15 of the Tax Administration Act, for each month that the employer fails to submit a complete return which, in total, may not exceed 10 per cent of the total amount of employees’ tax deducted or withheld, or which should have been deducted or withheld by the employer from the remuneration of employees for the period described in that subparagraph .

[Subparagraph (6) added by section 22(1)(b) of Act 4 of 2008 and substituted by section 22 of Act 8 of 2010, by section 271 read with paragraph 85(e) of Schedule 1 of Act 28 of 2011, by section 20 of Act 21 of 2012 and by section 9 of Act 33 of 2019]

(7) If the total amount of employees’ tax deducted or withheld, or which should have been deducted or withheld for the period described in subparagraph (3), is unknown, the Commissioner may estimate the total amount based on information readily available and impose the penalty under subparagraph (6) on the amount so estimated.

[Subparagraph (7) added by section 7 of Act 21 of 2021]

(8) Where, upon determining the actual employees’ tax of the person in respect of whom the penalty was imposed under subparagraph (7), it appears that the total amount of employees’ tax was incorrectly estimated under subparagraph (7), the penalty must be adjusted in accordance with the correct amount of employees’ tax effective on the date of the imposition of the penalty under subparagraph (6) read with subparagraph (7).

[Subparagraph (8) added by section 7 of Act 21 of 2021]

Paragraph 13 (Fourth Schedule) – Furnishing and obtaining of employees’ tax certificates

Posted on October 15, 2015September 7, 2024 by admin_kmos

13. FURNISHING AND OBTAINING OF EMPLOYEES’ TAX CERTIFICATES

(1) Subject to the provisions of paragraphs 5, 14(5) and 28, every employer who, during any period contemplated in subparagraph (1A), deducts or withholds any amount by way of employees’ tax as required by paragraph 2 shall, within the time allowed by subparagraph (2) of this paragraph, deliver to each employee or former employee to whom remuneration has during the period in question been paid or become due by such employer, an employees’ tax certificate in such form as the Commissioner may prescribe or approve, which shall show the total remuneration of such employee or former employee and the sum of the amounts of employees’ tax deducted or withheld by such employer from such remuneration during the said period, excluding any amount of remuneration or employees’ tax included in any other employees’ tax certificate issued by such employer, unless such other certificate has been cancelled by such employer.

[Subparagraph (1) amended by section 24(a) of Act 72 of 1963 and substituted by section 49(a) of Act 101 of 1990, by section 23(1) of Act 19 of 2001, by section 12(a) of Act 23 of 2015 and by section 7(a) of Act 24 of 2020]

(1A) The period referred to in subparagraph (1) shall be the period of 12 months ending on the last day of February of any year or, at the option of the employer which may be exercised by him in relation to all his employees or any class of his employees, the period, whether of 12 months or not (to be known as an alternate period), commencing on the day following the last day of the preceding alternate period in relation to the employer and ending on a date falling not more than 14 days (or such greater number of days as the Commissioner having regard to the circumstances of the case may allow) before or after the last day of February of any year.

(1B) Where any employer has in relation to any employee exercised an option as contemplated in subparagraph (1A), any remuneration which is paid or becomes payable to the employee by the employer during an alternate period shall for the purposes of this Act be deemed to have been paid or to have become payable to the employee during the year of assessment ended on the last day of February of the calendar year in which such alternate period ended.

(2) The employees’ tax certificate referred to in sub–paragraph (1) shall be delivered –

(a) if the employer who is required to deliver the certificate has not ceased to be an employer in relation to the employee concerned, within 60 days after the end of the period to which the certificate relates;

(b) if the said employer has ceased to be an employer in relation to the employee concerned but has continued to be an employer in relation to other employees, within fourteen days of the date on which he has so ceased; or

[Item (c) amended by section 24 of Act 72 of 1963 and substituted by section 12 of Act 23 of 2015 effective on 8 January 2016]

(3) For the purposes of sub–paragraph (2) an employer shall, if the Commissioner having regard to the circumstances of the case so directs be deemed not to have ceased to be an employer in relation to any of his casual employees who is likely from time to time to be re–employed by such employer.

(4) Notwithstanding the provisions of subparagraphs (1) and (2), any employer who has deducted or withheld employees’ tax from the remuneration of any employee shall, as and when required by the Commissioner, deliver to such employee an employees’ tax certificate in such form as the Commissioner may prescribe or approve, which shall show the total remuneration of such employee or former employee and the sum of the amounts of employees’ tax deducted or withheld by such employer from such remuneration during any period specified by the Commissioner, but excluding any amount of remuneration or employees’ tax included in any other employees’ tax certificate issued by such employer, unless such other certificate has been cancelled by such employer.

[Subparagraph (4) amended by section 24(a) of Act 72 of 1963 and substituted by section 7(b) of Act 24 of 2020]

(5) It shall be the duty of any employee or former employee who has not received an employees’ tax certificate within the time allowed by sub–paragraph (2) forthwith to apply to the employer for such certificate.

(6) ……….

(7) It shall be sufficient compliance with the provisions of sub–paragraph (1) or (4) in regard to the delivery of any employee’s tax certificate to any employee or former employee if such certificate is delivered to the employees’ authorized agent or the representative taxpayer in respect of the remuneration shown in such certificate or, where delivery cannot conveniently be effected by personal delivery, if such certificate is sent to the employee or former employee or such agent or representative taxpayer.

(8) . . . . . .

[Subparagraph (8) deleted by section 7(c) of Act 24 of 2020]

(9) . . . . . .

[Subparagraph (9) deleted by section 7(c) of Act 24 of 2020]

(10) . . . . . .

[Subparagraph (10) deleted by section 7(c) of Act 24 of 2020]

(11) . . . . . .

[Subparagraph (11) deleted by section 7(c) of Act 24 of 2020]

(12) ………..

(13) . . . . . .

[Subparagraph (13) deleted by section 7(c) of Act 24 of 2020]

(14) . . . . . .

[Subparagraph (14) deleted by section 7(c) of Act 24 of 2020]

(15) For the purposes of this Schedule, any employees’ tax certificate on which appears the name or any trade name of any employer shall, until the contrary is proved, be deemed to have been issued by such employer if such certificate is in a form prescribed by the Commissioner.

[Subparagraph (15) amended by section 24(b) of Act 72 of 1963 and substituted by section 7(d) of Act 24 of 2020]

Paragraph 11C of Fourth Schedule – Deemed remuneration in respect of directors of private companies

Posted on October 15, 2015March 29, 2021 by admin_kmos

11C. . . . . . .

[Paragraph 11C inserted by section 22(1) of Act 19 of 2001, amended by section 85(1) of Act 45 of 2003, by section 271 read with paragraph 83 of Schedule 1 of Act 28 of 2011, by section 10 of Act 39 of 2013 and by section 11 of Act 23 of 2015 and repealed by section 11(1) of Act 16 of 2016 effective on 1 March, 2017 and applicable in respect of years of assessment commencing on or after that date]

12. . . . . . .

Paragraph 11B (Fourth Schedule) – Standard Income Tax on Employees (SITE)

Posted on October 15, 2015December 6, 2017 by admin_kmos

STANDARD INCOME TAX ON EMPLOYEES

11B. ……….

[Paragraph 11B inserted by section 41 of Act 90 of 1988, amended by section 22 of Act 70 of 1989, section 47 of Act 101 of 1990, section 46 of Act 129 of 1991, section 34 of Act 141 of 1992, section 3 of Act 168 of 1993, section 40 of Act 21 of 1995, section 35 of Act 36 of 1996, section 48 of Act 28 of 1997, section 53 of Act 30 of 1998, section 56 of Act 59 of 2000, section 33 of Act 30 of 2002, section 56 of Act 74 of 2002, section 22 of Act 16 of 2004, section 43 of Act 20 of 2006, section 2 of Act 8 of 2007, section 57 of Act 8 of 2007, section 1 of Act 3 of 2008, section 44 of Act 3 of 2008, section 70 of Act 60 of 2008, section 20 of Act 8 of 2010, section 271 of Act 28 of 2011, section 9 of Act 39 of 2013, repealed by section 10 of Act 23 of 2015 effective on 1 March 2016]

Paragraph 11A (Fourth Schedule) – Employees’ tax on certain amounts included as remuneration

Posted on October 15, 2015September 7, 2024 by admin_kmos

11A.

(1) Where by virtue of the provisions of paragraph (b), (d), (e) or (g) of the definition of ‘remuneration’ in paragraph 1, the remuneration of an employee includes-

(a) any gain made by the exercise, cession or release of any right to acquire any marketable security as contemplated in section 8A;

(b) any gain made from the disposal of any qualifying equity share as contemplated in section 8B;

(d) any amount received by or accrued to that employee by way of a dividend contemplated in-

(i) paragraph (dd) of the proviso to section 10(1)(k)(i);

(ii) paragraph (ii) of the proviso to section 10(1)(k)(i);

(iii) paragraph (jj) of the proviso to section 10(1)(k)(i); or

(iv) paragraph (kk) of the proviso to section 10(1)(k)(i),

the person by whom that right was granted or from whom the equity instrument or qualifying equity share that gave rise to the gain or amount was acquired, as the case may be, is deemed to be a person who pays or is liable to pay to that employee the amount of the gain referred to in paragraph (a) or (b) or the amount referred to in paragraph (c) or (d).

[Subparagraph (1) substituted by section 10 of Act 13 of 2017 effective on 1 March 2018, applies in respect of years of assessment commencing on or after that date]

(2) Employees’ tax in respect of the amount of remuneration contemplated in subparagraph (1) must, unless the Commissioner has granted authority to the contrary, be deducted or withheld by the person referred to in subparagraph (1) from-

(a) any consideration paid or payable by that person to that employee in respect of the cession, or release of that right or the disposal of that qualifying equity share, as the case may be;

(b) any cash remuneration paid or payable by that person to that employee after that right has to the knowledge of that person been exercised, ceded or released or that equity instrument has to the knowledge of that person vested or that qualifying equity share has to the knowledge of that person been disposed of; or

Provided that where that person is an ‘associated institution’, as defined in paragraph 1 of the Seventh Schedule, in relation to any employer who pays or is liable to pay to that employee any amount by way of remuneration during the year of assessment during which the gain contemplated in subparagraph (1)(a) or (b) or the amount contemplated in subparagraph (1)(c) or (d) arises, and-

(i) that person is not resident nor has a representative employer;

(ii) that person is unable to deduct or withhold the full amount of employees’ tax during the year of assessment during which the gain or the amount arises, by reason of the fact that the amount to be deducted or withheld from that remuneration by way of employees’ tax exceeds the amount from which the deduction or withholding can be made; or

(iii) the amount of the dividend referred to in paragraph (c) consists of an equity instrument referred to in section 8C,

that person and that employer must deduct or withhold from the remuneration payable by them to that employee during that year of assessment an aggregate amount equal to the employees’ tax payable in respect of that gain or that amount and shall be jointly and severally liable for that aggregate amount of employees’ tax.

[Subparagraph (2) substituted by section 10 of Act 13 of 2017 effective on 1 March 2018, applies in respect of years of assessment commencing on or after that date]

(3) The provisions of this Schedule apply in relation to the amount of employees’ tax deducted or withheld under subparagraph (2) as though that amount had been deducted or withheld from the amount of the gain referred to in subparagraph (1)(a) or (b) or the amount referred to in subparagraph (1)(c) or (d).

[Subparagraph (3) substituted by section 10 of Act 13 of 2017 effective on 1 March 2018, applies in respect of years of assessment commencing on or after that date]

(4) Before deducting or withholding employees’ tax under subparagraph (2) in respect of remuneration contemplated in subparagraph (1)(a), (c) or (d), that person and that employer must ascertain from the Commissioner the amount to be so deducted or withheld.

[Subparagraph (4) substituted by section 10 of Act 13 of 2017 effective on 1 March 2018, applies in respect of years of assessment commencing on or after that date]

(5) If that person and that employer are, by reason of the fact that the amount to be deducted or withheld by way of employees’ tax exceeds the amount from which the deduction or withholding is to be made, unable to deduct or withhold the full amount of employees’ tax during the year of assessment during which the gain referred to in subparagraph (1)(a) or (b) or the amount referred to in subparagraph (1)(c) or (d) arises, they must immediately notify the Commissioner of the fact.

[Subsection (5) substituted by section 10 of Act 13 of 2017 effective on 1 March 2018, applies in respect of years of assessment commencing on or after that date]

(6) Where an employee has-

(a) under any transaction to which neither that person nor that employer is a party made any gain; or

(b) disposed of any qualifying equity share as contemplated in subparagraph (1),

that employee must immediately inform that person and that employer of the transaction or the disposal and of the amount of that gain.

(7) Any employee who, without just cause shown by him or her, fails to comply with the provisions of subparagraph (6) shall be guilty of an offence and liable on conviction to a fine not exceeding R2 000.

[Paragraph 11A inserted by section 45 of Act 89 of 1969, amended by section 47 of Act 28 of 1997, substituted by section 19 of Act 34 of 2004, amended by section 51 of Act 31 of 2005, section 67 of Act 35 of 2007, section 19 of Act 8 of 2010 and section 9 of Act 23 of 2015 and substituted by section 10 of Act 16 of 2016 effective on 19 January 2017]

Paragraph 11 (Fourth Schedule) – Issue of directive by Commissioner

Posted on October 15, 2015September 7, 2024 by admin_kmos

11. The Commissioner may, having regard to the circumstances of the case, issue a directive-

(a) to an employer authorising that employer-

(i) to refrain from deducting or withholding any amount under paragraph 2 by way of employees’ tax from any remuneration due to any employee of that employer; or

(ii) to deduct or withhold by way of employees’ tax from any remuneration in terms of paragraph 2, a specified amount or an amount to be determined in accordance with a specified rate or scale,

in order to alleviate hardship to that employee due to circumstances outside the control of the employee or to correct any error in regard to the calculation of employees’ tax, or in the case of remuneration constituting commission or where the remuneration is paid or payable to a personal service provider and that directive must be complied with.

[Subparagraph (a) amended by section 42 of Act 20 of 2006, by section 69(1) of Act 60 of 2008 and by section 20 of Act 20 of 2022]

(b) . . . . . .

[Paragraph 11 substituted by section 39 of Act 21 of 1995 and by section 84 of Act 45 of 2003. Sub-paragraph (b) deleted by section 9(1) of Act 16 of 2016 effective on 1 March, 2017 and applicable in respect of years of assessment commencing on or after that date]

Paragraph 10 (Fourth Schedule) – Variation of determination of employees’ tax

Posted on October 15, 2015January 15, 2025 by admin_kmos

10.

(1) If the Commissioner is satisfied that the circumstances warrant a variation of the basis provided in paragraph 9 or 11A(4) for the determination of amounts of employees’ tax to be deducted or withheld from remuneration of employees in the case of any employer, the Commissioner may agree with such employer as to the basis of determination of the said amounts to be applied by that employer, and the amounts to be deducted or withheld by that employer in terms of paragraph 2 shall, subject to the provisions of paragraph 11 and section 95 of the Tax Administration Act, be determined accordingly.

[Subparagraph (1) substituted by section 8 of Act 16 of 2016 and by section 15 of Act 18 of 2023]

(2) Any agreement made in terms of sub–paragraph (1) shall remain in force indefinitely, but the Commissioner or the employer concerned may give notice of termination thereof and upon the expiration of a period of three months from the date of such notice such agreement shall terminate.

Paragraph 9 (Fourth Schedule) – Employees’ tax deduction tables

Posted on October 15, 2015January 7, 2026 by admin_kmos

(1) The Commissioner may from time to time, having regard to the rates of normal tax as fixed by Parliament or foreshadowed by the Minister in his budget statement and to any other factors having a bearing upon the probable liability of taxpayers for normal tax, prescribe—

(a) deduction tables applicable to such classes of employees as the Commissioner may determine, taking into account the rebates applicable in terms of section 6; and

(b) the manner in which such tables shall be applied,

and the amount of employees’ tax to be deducted from any amount of remuneration shall, subject to the provisions of subparagraphs (3) and (4) of this paragraph and paragraphs 10, 11, 11A (4) and section 95 of the Tax Administration Act, be determined in accordance with such tables or where subparagraph (3) or (4) is applicable, in accordance with that subparagraph.

[Subparagraph (1) substituted by section 39 of Act 88 of 1971 and by section 32(a) of Act 103 of 1976, amended by section 29 of Act 104 of 1980 and by section 46 of Act 101 of 1990 and substituted by section 55 of Act 59 of 2000, by section 21(1)(a) of Act 19 of 2001, by section 7(1)(a) of Act 16 of 2016 and by section 14 of Act 18 of 2023]

(2) Any tables prescribed by the Commissioner in accordance with sub-paragraph (1) shall come into force on a date prescribed by the Commissioner, and shall remain in force until withdrawn by the Commissioner.

[Sub-paragraph (2) substituted by section 7(1)(b) of Act 16 of 2016]

(3)

(a) The amount to be deducted or withheld in respect of employees’ tax from any lump sum to which paragraph (d) or (e) of the definition of “gross income” in section 1 applies, or any amount to which paragraph (eD) of that definition or section 7A applies, or any transfers as contemplated in paragraph 2(1)(d) of the Second Schedule, shall be ascertained by the employer from the Commissioner before paying out such lump sum, and the Commissioner’s determination of the amount to be so deducted or withheld shall be final.

[Item (a) substituted by section 7(1) of Act 12 of 2024 and by section 5(1) of Act 44 of 2024 deemed to have come into operation on 1 September, 2024]

(b) . . . . . .

[Sub-paragraph (3) substituted by section 32(b) of Act 103 of 1976 and by section 41 of Act 20 of 2006, amended by section 66(1) of Act 35 of 2007 and by section 68(1) of Act 60 of 2008 and substituted by section 20 of Act 18 of 2009. Item (b) substituted by section 8(a) of Act 23 of 2015 and deleted by section 7(1)(c) of Act 16 of 2016 effective on 1 March, 2017]

(4) The amount to be deducted or withheld in respect of any amount contemplated in paragraph (eA) of the definition of “gross income” in section 1 of this Act, shall be ascertained by the employer on inquiry from the Commissioner before the date of transfer or conversion of any amount for the benefit or ultimate benefit of any member as contemplated in such paragraph and the Commissioner’s determination of the amount to be so deducted or withheld shall be final.

(5) The amount to be deducted or withheld in respect of employees’ tax from any amount paid or payable to any director of any private company during any year of assessment of that director, in respect of services rendered or to be rendered by that director to that company, shall be determined after taking into account any amount of employees’ tax paid or payable to the Commissioner by that company during that year of assessment, in respect of that director in terms of paragraph 11C(2).

(6) There must be deducted from the amount to be withheld or deducted by way of employees’ tax as contemplated in paragraph 2 the amount-

(a) of the medical scheme fees tax credit that applies in respect of that employee in terms of section 6A; and

(b) where the employee is entitled to a rebate under section 6(2)(b), of the additional medical expenses tax credit that applies in respect of that employee in terms of section 6B(3)(a)(i),

if-

(i) the employer effects payment of the medical scheme fees as contemplated in section 6A(2)(a); or

(ii) the employer does not effect payment of the medical scheme fees as contemplated in section 6A(2)(a), at the option of the employer, if proof of payment of those fees has been furnished to the employer.

[Subparagraph (6) inserted by section 95 of Act 24 of 2011 effective on 1 March 2012, substituted by section 8 of Act 23 of 2015 effective on 8 January 2016]

Paragraph 7 (Fourth Schedule) – Agreement between employer and employee void

Posted on October 15, 2015July 22, 2017 by admin_kmos

7. Any agreement between an employer and an employee whereby the employer undertakes not to deduct or withhold employees’ tax shall be void.

8. ……….