Employers must submit an accurate Employer Reconciliation Declaration (EMP501), Employee Tax Certificates [IRP5/IT3(a)s] to be issued and if applicable, a Tax Certificate Cancellation Declaration (EMP601).

There are three elements that must reconcile in order for your submission to be successful. They are:

• Monthly Employer Declarations (EMP201s) submitted – Pay-As-You-Earn (PAYE) and/or Skills Development Levy (SDL), Unemployment Insurance Fund (UIF) amounts due and Employment Tax Incentive (ETI), (if applicable)
• Payments made (excluding penalty and interest payments)
• IRP5/IT3(a)s generated – PAYE, SDL and UIF values

The Employer Annual Reconciliations therefore allows employers to accurately calculate the difference, if any, between the total value of the tax certificates issued, the total liability declared (EMP201) and the total payments made to SARS.

Who must submit?

Every employer who is registered for Pay-as-you-earn(PAYE), Unemployment Insurance Fund(UIF) or Skills Development Levy(SDL), should submit an EMP501 by 31 October 2017. The Employer Interim Reconciliation period, referring to the period from 1 March 2017 to 31 August 2017, will open on 15 September and run to 31 October 2017.

During the Interim Reconciliation, employers are required to submit an Employer Reconciliation Declaration (EMP501) and Employee Income Tax Certificates [IRP5/IT3(a)s] for this six-month interim period.

We recommend that employers accurately verify and update each employee’s personal and financial details before submitting their Annual Reconciliation Declaration (EMP501) and Employees Income Tax Certificates [IRP5/IT3(a)s] to SARS.

Please take note of the following penalties:

1. Non-submission of an Employer Annual Reconciliation (EMP501) on or before the due date.
2. Non-submission of employee IRP5 / IT3(a) certificates.
3. Submission of incorrect or inaccurate data relating to the IRP5 / IT3(a) certificates.

At DTVT, we can assist you with the successful submission of your Annual Reconciliation Declaration (EMP501). Please contact us for more information or for any assistance.

This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice.  Errors and omissions excepted (E&OE)