Paymaster Magazine

Five things to do before the end of February to get ready for tax year-end

1 March is the day. The new tax year has arrived and very soon you will be rolling over into the new tax year. Most payroll systems now “lock down “the old tax year and you can no longer change any of that information. You must have these issues  sorted out  before the tax year end.  You really don’t want to start having to open the payroll to change earnings or deductions or add information once the 7 March has come and gone.

Here are five things to do that will make your life easier:

 

1)      Check that all the employee details are all complete

Please check that all the information required by the receiver of revenue is correct and complete for all employees. So you will want to draw a report from your payroll system listing the following:

a)      Address of the employee

b)      Banking details of the employee

c)      Identity number or passport number

d)     Tax reference number.

 

2)      Reconciliations are done payroll to tax paid

 

Reconcile all tax payments made to the receiver of revenue to the figures declared on the EMP. 201 form submitted to SARS. These must balance. If they do not balance you need to correct the issue as soon as possible, or make a note of why so that you can explain the differences on your annual submission.The best way to do this is to get the EMPSA from SARS. This shows the actual payments that they have recorded for the year. This can be compared with YTD totals from the payroll system. If they do not tie up then a correction can be made with the February EMP201. This means that the EMP501 reconciliation on Easyfile should not be a problem

 

3)      Confirm all submissions to SARS

 

Check to make sure that SARS have received all your EMP.201 submissions and that there are no outstanding issues that need to be dealt with. It is always a good idea to keep up to date with SARS documentation.

 

4)      Remind car holders to take mileage 1 march

 

Please remind all your employees who have company cars or car allowance to record their mileage first thing on the 1 March. It will be a good idea to make sure all the details for the company cars are recorded on the payroll.

 

5)      Resolve any outstanding tax issues (retirement annuity numbers etc)

 

Make sure that all the earnings and deductions are listed under the right Payroll Codes (a list is available on the SARS website) In addition make sure you have all the information for any retirement annuities you have been processing

It is a useful exercise to run a test IRP5 upload as this can show up any oddities like negative 3601 income and  negative non retirement funding income which can be corrected in the February payroll. This also throws up incomplete addresses, business telephone numbers, retrenchments payments without directive numbers etc. These all have to be correct before Easyfile will accept the upload file

Adrian Baillie-Stewart

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