>
Employers in South Africa must register with SARS for PAYE (Pay As You Earn), UIF (Unemployment Insurance Fund), and SDL (Skills Development Levy) as soon as they employ staff. All three are reported and paid monthly via the EMP201 return.
PAYE is income tax withheld by the employer from employee remuneration and paid to SARS on behalf of the employee.
Use the SARS Tax Tables (updated annually in the Budget):
2024/25 Individual Tax Brackets:
| Taxable Income | Rate |
|---|---|
| R0 – R237,100 | 18% |
| R237,101 – R370,500 | R42,678 + 26% above R237,100 |
| R370,501 – R512,800 | R77,362 + 31% above R370,500 |
| R512,801 – R673,000 | R121,475 + 36% above R512,800 |
| R673,001 – R857,900 | R179,147 + 39% above R673,000 |
| R857,901 – R1,817,000 | R251,258 + 41% above R857,900 |
| R1,817,001+ | R644,489 + 45% above R1,817,000 |
Primary Rebate: R17,235 (all taxpayers) Secondary Rebate: R9,444 (taxpayers 65 years and older) Tertiary Rebate: R3,145 (taxpayers 75 years and older)
Tax Thresholds (below which no tax is payable):
At year-end, the employer issues each employee an IRP5 (tax certificate) reflecting total remuneration and PAYE deducted. This forms the basis of the employee's personal tax return (ITR12).
Must be included in remuneration for PAYE purposes:
| Benefit | Taxable Amount |
|---|---|
| Company car | 3.5% of determined value per month (or 3.25% if maintaining logbook; reduces if employee bears fuel costs) |
| Medical aid subsidy | Employer contribution above prescribed amount |
| Low-interest loans | Difference between official rate (8.25% p.a. per SARS) and actual interest charged |
| Residential accommodation | Formula-based (R value or market value) |
| Use of company assets | 15% of cash equivalent per annum |
UIF provides short-term relief to workers who become unemployed, ill, or go on maternity leave.
Monthly remuneration is capped at R17,712 for UIF purposes. Maximum monthly UIF contribution per employee: R354.24 (employee) + R354.24 (employer) = R708.48 total.
Employers must register employees with UIF via uFiling or SARS eFiling. The COVID-19 TERS (Temporary Employer/Employee Relief Scheme) was administered via UIF — maintain employer and employee registration to access future relief schemes.
SDL funds skills development through the SETAs (Sector Education and Training Authorities). Employers can recover up to 70% of SDL paid by submitting Workplace Skills Plans (WSP) and Annual Training Reports (ATR) to their relevant SETA.
1% of total leviable amount (remuneration paid to employees).
Employers with an annual payroll of R500,000 or less are exempt from SDL.
Total remuneration paid to all employees, including:
Excludes: Pension fund contributions, reimbursements for actual expenditure.
Mandatory Grant (20%): Submitted via Employer Registration Form to SETA. Discretionary Grant (50%): Submitted with Workplace Skills Plan and Annual Training Report. Deadline: 30 April annually.
Due: 7th of the following month (e.g., January PAYE due by 7 February). If the 7th falls on a weekend or public holiday, due the last business day before.
The EMP201 consolidates:
Payment must accompany the return. Late payment attracts 10% penalty + interest at the prescribed rate.
Reconciles monthly EMP201 payments against the total IRP5s issued to employees.
| Period | Submission Deadline |
|---|---|
| Interim (March–August) | 31 October |
| Annual (March–February) | 31 May |
The EMP501 reconciliation must balance exactly. Common reconciling items:
SARS's Auto-Assessment system uses IRP5 data from the EMP501 to pre-populate employee tax returns — accuracy is critical.