The deadline to submit your PAYE recon, aslso known as the EMP501 is 31 May 2022.
What is a PAYE recon?
This is the process where the amount of PAYE deducted monthly and paid over to SARS is reconciled. This is to ensure that all the amounts deducted from employees is paid over to SARS.
During this process, when the EMP501 is submitted, IRP5 certificates have to be issued for every employee. These certificates then have to be issued to every employee.
What information does the IRP5 certificate need to contain?
The certificate needs to contain all income the employee has received. This includes the salary, all other benefits and contributions made by the employer. It also need to contain all deductions made by the employer towards pension funds, retirement funds and medical aids. Also, it needs to show the amounts deducted for PAYE, SDL and UIF. The IRP5 certificate also needs to show the number of months which the employee has worked. Read more about EMP501.
It is very important to submit this recon, as the employees have to use it to submit their personal income tax returns. Failing to submit the return will also attract penalties for non or late submissions.
Employers have to submit their annual PAYE recons, also known as the EMP501 before 31 May 2021. This applies to all employers who
This is applicable to all employers who are registered for PAYE and deduct employee tax from their employees on a monthly basis. After the recon is submitted, IRP5 certificates will be generated for all employees. These certificates have to be handed over to the employees in order for them to submit their annual income tax return to SARS.
Failure to submit the PAYE recon will result in a penalty of 1% of the annual PAYE liability of the company.
Have you ever wondered when to start deducting PAYE for your employees? The answer is quite simple.
SARS makes use of PAYE tables to determine from which amount and how much PAYE should be deducted. The current amount, from 1 March 2020 is R7 479. This means, that when you have an employee that receives R7 479 or more per month in salaries, the company should register for and deduct PAYE. This amount is then paid over to SARS on a monthly basis. This also means that the employee should be provided with an IRP5 every year.