Repayment of SARS Covid-19 Employees’ tax deferral – reminder of repayment obligation

Oct 7, 2020 | Taxation Blog

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During April 2020 the president announced certain measures to assist employers during the Covid-19 lockdown. One of these included a deferral of the monthly Employees’ tax due to SARS for qualifying employers. The deferral of 35% of the PAYE liability from 1 April 2020 – 31 August 2020 was to be deferred to 1 September 2020 – 31 March 2021 with the repayment to occur in 6 equal instalments via the EMP201 system.

The EMP201 declaration for the month of September 2020 (due to SARS by 7/10/2020) would be the first of the 6 equal instalments due, with the following dates for the balance:

  • 2nd payment – 6 November 2020;
  • 3rd payment – 7 December 2020;
  • 4th payment – 7 January 2021;
  • 5th payment – 5 February 2021; and
  • 6th payment – 5 March 2021

Employers are to refer to their 2021 SARS PAYE Statement of account (EMPSA) where SARS has allocated the repayments automatically in the respective periods – please note that Penalties and Interest will be imposed on any default of the instalment (short and/or no payment).

To avoid misallocation or incorrect allocation by SARS with the “normal” EMP201 liabilities for September 2020 – February 2021, employers are advised to make separate payments in respect of each instalment of the deferral – please refer to the unique Payment Reference Number (PRN) as allocated by SARS on the EMPSA.

Please contact me to assist you in this regard to ensure your tax compliance status is not impacted.

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