The new PAYE reconciliation
For the first time the new bi-annual employer reconciliation will be effective from August 2010. The last yearly reconciliation was on February 2010. From March 2010 the reconciliation will be done on August and February every year. With this change come some other changes as well.
The biggest implementation SARS brought in was the new employee income tax numbers. From 1 March each and every employee needs to have an income tax reference number.
Without this income tax number you will not be able to create an IRP 5 or IT 3(a) for your employee nor submit your PAYE reconciliation. Any late submissions can be fined with a 10% penalty on the PAYE liability.
This highlights the importance of keeping employee files.
In this file keep your employee's CV, leave records, copy of ID document, income reference number etc. This is one aspect a huge amount of businesses tend to overlook. I suggested to a few clients for future reference, never to employ someone without an ID and income tax number.
Apart from the above the following will also be crucial employee information to provide to SARS.
1. Banking details
2. Residential and postal address
3. ID number
4. Business & home telephone numbers
Hope that this will come in handy in the upcoming three months and we will gladly be of assistance.
Yours in tax,