Proposed Employee Tax Incentive
- Oct
- 29
- 2013
- Posted by Tax Dept
- Posted in Taxation Blog
Draft regulations published lay out the proposed tax incentive to come into effect on 1 January 2014 and is estimated to run for a period of 3 years (until 31 December 2013).
Qualifying employees are defined (specific criteria and exclusions apply) but briefly include the following:
- the employee must have a SA ID document
- be between age of 19 – 29
- employed by the employer on or after 1 October 2013
- earn less than R6 000 per month
- must not be connected to the employer
- does not apply to Domestic workers.
This is to incentivise employers to employ young persons and encourage sustainable employment creation. The employer will benefit for the first 2 years by a reduction of their actual SARS PAYE payments in respect of each qualifying person – see below table. This will not affect the employee in any way and their own tax liabilities due to SARS (IRP5’s are to be issued to them like any normal employee).
The employers have to ensure that they are compliant with all returns and payments to SARS to be eligible for this incentive. Unfair dismissals by employers and non-compliance with sector determinations/bargaining council agreements will cause disqualification for the incentive and possible penalties of up to 150% of the tax Incentives received in a 12 month-period.
All material subject to our Legal Disclaimers.
Recent Posts
- MD Accountants & Auditors Inc – Section 12J Webinar 16/02/2021
- Trusts welcome DTIC Minister Patel’s support for ownership schemes 15/02/2021
- FORFEITURE OF SEVERANCE PAY 12/02/2021
- MD’s Top Tax Savings Tips – Ahead of the Budget on 24 February 2021!!! 11/02/2021
- UIF launches e-compliance certificate system 10/02/2021
- MD’s Top Tax Savings Tips ahead of the Budget on 24th February 09/02/2021
- Potential taxes to fund the vaccine. Be prepared and plan now before the Budget! 08/02/2021
- Employment Equity Amendment Bill described as a “game-changer” 03/02/2021
- Are you being sold a dubious B-BBEE share option scheme? Hear what the B-BBEE Commission has to say… 01/02/2021
- FILING SEASON 2020: DEADLINE FOR ONLINE FILERS EXTENDED 29/01/2021
- Businesses reminded of City support to offer relief 26/01/2021
- 2nd 2021 Provisional Tax Information Request 18/01/2021
- Changes to the South African Exchange Control Rules 13/01/2021
- MD are now on Instagram too!!! 07/01/2021
- Congratulations to Amanda Kungwayo – 15 years with MD today! 03/01/2021
- PAIA manual | MD ACCOUNTANTS AND AUDITORS INCORPORATED | Date of revision: 15/12/2020 23/12/2020
- Season’s Greetings 21/12/2020
- COIDA: EXCLUSION OF DOMESTIC WORKERS INVALID: Employers’ contributions cannot be backdated 09/12/2020
- Congratulations to Juanita Roman – 20 years with MD today! 01/12/2020
- BEE pioneers fight for their legitimacy 27/11/2020
- Department of Employment and Labour welcomes Constitutional court judgement on domestic workers 24/11/2020
- TERS – FINAL opportunity to claim – Do not Miss out! 23/11/2020