About a fifth of South African companies have already submitted their payrolls to the South African Revenue Service (SARS) through its e@syFile software system.
This year is the first that the taxman will penalise companies if they don't submit employees' earnings by the 3 June cut-off. Companies' submissions are the first step in the tax-filing season.
SARS group executive Mark Kingon says about 47 000 employers have submitted payroll information through the e@syFile. There are around 260 000 companies in SA that must file before the deadline.
Kingon says companies that fail to comply with the filing requirements will be penalised by as much as 10% of the total tax that has been deducted from employees' salaries. “It should be noted though that SARS will not raise penalties in an unreasonable fashion in cases where employers have tried to comply,” he says.
SARS has a process that will allow employers to apply for the remission penalties, says Kingon. He explains the more complete a submission is, the higher the amount that can be remitted.
Fines imposed
Last year, SARS introduced a penalty for people who didn't file individual tax returns. Non-compliance with filing requirements could result in a penalty of between R250 and R16 000 for every month a tax return is outstanding.
Last year, SARS received more than four million returns from individual taxpayers, of which about 95% were submitted electronically.
However, some companies have battled to get their payroll information into SARS. VIP Liquid Payroll business manager for Softline VIP Karen Schmikl says the main problem she has encountered is companies struggling to get hold of income tax numbers, which is required for tax certificates.
“Employers are not well informed about the processes to follow that will allow them to synchronise their e@syFile applications to get hold of the tax certificate information,” says Schmikl.
She adds income tax numbers must be on all tax certificates, so a certificate without an income tax number will be deemed incomplete. Softline VIP is part of Sage Group.
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