Unemployment Insurance Fund Contributions- Remuneration Limit Increase

Effective 01 October 2012, employers must adjust their UIF contribution calculations to apply the new remuneration limit published by the Minister of Finance on 26 September 2012 (refer Government Gazette no 35715, dated 26 September 2012).

When calculating the 1% contribution deducted from employees and the 1% contributed by employers, a new annual remuneration limit of R178 464 should be applied. This means that employees earning R14 872 per month or more (R178 464 / 12) will now contribute a maximum of R148.72, and their employers will contribute an equal amount.

Currently the earnings limit is set at R12 478 per month (R149 736 /12) which means that employees whose earnings exceed the current limit will see a reduction in their net pay from October 2012 as their UIF contribution deduction will be slightly higher to accommodate the remuneration limit increase. Employers will see a similar effect as their portion of the UIF contribution increases to ultimately result in an increase in salary related expenses.

New Tax Administration Act

The President of South Africa promulgated the long awaited Tax Administration Act into law. Although the new law will only come into operation at a later stage, it is advisable that taxpayers are aware of the key features of the Act that will reduce administrative burdens and streamline processes. Please visit www.sars.gov.za for further information.

Key features of the Act are:

Kindly note SARS will be hosting free workshops from the 15th of August to discuss the implementation and application of the new Tax Administration Act. Book your seat online by visiting http://www.sars.gov.za/home.asp?pid=78737

Compensation Fund Return of Earnings deadline extended to 31 July 2012

The Department of Labour posted a notice on http://www.labour.gov.za/ announcing the extension of the deadline for submissions of the annual return of earnings. Originally, the deadline was extended to 31 May 2012. Only a few weeks before this deadline, the Compensation Fund made a new online portal available where employers could submit their W.As8 returns if they have not received the original manual form in the post.

The deadline for submitting the return of earnings has now been extended to 31 July 2012, allowing another 2 months for employers to get their annual Compensation Fund declarations done.

Basic Conditions of Employment Act: Earnings Threshold increase effective 01 July 2012

The Minister of Labour announced that an increase in the BCEA earnings threshold will take effect on 01 July 2012. The new earnings threshold will be R183 008 per annum while it currently stands at R172 000 per annum.

The annual earnings threshold is applied to the Basic Conditions of Employment Act to determine whether certain provisions in the Act should be applied to a specific employee’s circumstances. Any employee earning above this annual earnings threshold will be excluded from the following sections in the Act:

ITREG

SARS is notifying employers that the results of the ITREG process completed during the past Employer’s Filing Season, are now available. This means that all employees who were issued with new Individual Income Tax Reference numbers as a result of their employers submitting their employee tax certificates via e@syFile, will have received their new reference numbers from SARS.

Employers can now access their PAYE data via SARS e@syFile and export a CSV file that contains all the new IT reference numbers. Selected payroll applications will have the ability to import this CSV file to update existing masterfile records. The import facility is available in both Pastel Partner and Pastel Evolution Payroll.

Residential Accommodation Fringe Benefit Abatement

Please take note that the abatement has increased from R59 750 to R63 556, effective 01 March 2012.

SARS e@syFile Employer System

The latest version of e@syFile™ Employer 6.1.2 is available to download from www.sarsefiling.co.za.