What You Need to Know About PAYE Registrations
PAYE registrations are compulsory for all businesses that employ people and pay them monthly salaries. If any of the employees in your business thus earn more than the minimum threshold for taxpayers, then your business must adhere to the requirements for PAYE registrations.
Fortunately, PAYE registrations are quick and easy when you make use of our professional tax consultancy services. We also help you gain an understanding of some of the essentials regarding PAYE. For now, let us look at some basics.
Important Deductions
Registration also means that you must register your employees for UIF. You must deduct UIF, and pay the contributions to the Unemployment Insurance Fund (UIF) on a monthly basis. You must also deduct PAYE and pay it over to SARS on a monthly basis.
UIF Contribution
As an employer, you must deduct 1% of the employee’s salary, and pay 1% as an employer towards the Fund. This means that 2% per employee must be paid to the UIF every month. Invest in a good payroll system, or use our professional assistance in this regard to help your business stay payroll tax-compliant. Keep in mind that the payslips must accurately reflect the deductions. We can also help with such, ensuring that your payroll taxes are accurate.
What if You Do Not Deduct PAYE?
If you have registered the employees for PAYE, then you must deduct the relevant amounts, and pay such over to SARS. Since we have already established that unless your employees earn less than the threshold amount, PAYE registrations are compulsory. It also means that you must deduct and pay over the PAYE. If you do not deduct the PAYE, then your business must pay the PAYE that you have not deducted. Here is where it becomes scary – failure to comply with the requirement comes with a hefty penalty.
EMP501 Reconciliation
Did you know that you must also do an EMP501 reconciliation twice annually? We understand that you want to focus on business growth rather than the tedious tax tasks. Fortunately, we love complex calculations, and certainly make it our business to help our clients stay tax-compliant. To this end, we are here to assist with the EMP501 reconciliation.
Monthly Declaration
Did you know that you must submit a monthly EMP201? It is a declaration required by SARS in which you state the total amount in addition to the allocations for SDL, UIF, and PAYE, and it is done using the EMP201 form. It is a type of payment declaration, and the amount you pay over to SARS corresponds with the declared amount.
Get Professional Help
Do not allow the very important administrative tasks of PAYE registrations and the likes to keep you from running your business. Let us help you to stay tax-compliant. Our team can handle tax registrations, calculation assistance, monthly declarations, and the twice-annual reconciliations.
Disclaimer: This article is for informational purposes only and does not constitute legal, tax, or financial advice. Call on us for professional legal advice, rather than relying on the information herein to make any decisions. The information is relevant to the date of publishing.