Since the current COVID-19 pandemic has been declared a national state of disaster, many households, businesses and ultimately lives have been irrevocably changed. Government has announced various relief measures in an attempt to provide for the wellbeing of the people of South Africa and navigate our already troubled economy through these uncertain times.
We have summarised the details of the application and implementation of these relief measures below, as are known at present, for your convenience. We will continue to update these with further developments and changes.
Our staff have officially returned to the offices on 1 October 2020 with a limited number of individuals continuing to work remotely from time to time. We encourage the use of our digital infrastructure in order conduct client meetings virtually as far as possible. In the event of any visits of meetings to be held at our offices, we want to ensure you that we have implemented the necessary protocols to ensure the safety of all visitors and staff.
Tax Relief Measures
Hold shift + scroll to view more of the table on smaller devices.| Tax subsidy | SARS ETI Payments | Delay PAYE liabilities | Provisional CIT Payments | Occupational Health and Safety | Compensation Fund | Skills development levy holiday | Fast-tracking of value-added tax (VAT) refunds: | Filing and first payment of carbon tax liabilities | Excise taxes on alcoholic beverages and tobacco products | Postponing the implementation of some Budget 2020 measures | Increasing the deduction available for donations to the Solidarity Fund: | Expanding access to living annuity funds: | |
| The Employment Tax Incentive (ETI) programme was introduced to promote employment, particularly for young workers. Government proposed the expansion of the ETI Programme for four months (1 April 2020 to 31 July 2020), to minimise job losses due to impact of COVID 19 on companies. | To get cash in the hands of compliant employers | Compensation for occupationally acquired COVID-19 Effective 20 March 2020 CompEasy system or Mutual Association Claims use Code U07.1 Can be contracted as employee in workplace or as part of travel | |||||||||||
| Relief | The first set of tax measures provided for a wage subsidy of up to R500 per month for each employee that earns less than R6 500 per month. This amount will be increased to R750 per month, for the next 4 months for any employee in the private sector. Impact on current ETI Law: 1. Increase the max ETI claimable by R 750 for eligible employees. (therefore can claim R 1750 per employee) 2. ETI reimbursements to the amount of R 750 for non eligible employees; for employees aged 18 to 29 non-eligible for ETI (already claimed for 24 months) and; employees aged 30 to 65 who are non-eligible (due to age). | Accelerate payments of ETI from twice a year to monthly. | The tax measures allow tax compliant businesses to defer 35% of their employees’ tax liabilities over the next five months (ending 31 August 2020) and a portion of their provisional corporate income tax payments (without penalties or interest). The relief provided are repayable to SARS in equal instalments over six months effective from September 2020 (your first payment will be repayable on 7 October) additional to the normal PAYE payments due in these periods The initial four month period was extended by one month to five months. As a result of this extension, repayments on the deferred tax will now only begin in October 2020 and run through until March 2021. However ,interest and penalties will apply if the employer has understated the PAYE liability for any of the four months. | 1. First Provisional Tax Payment due from 1 April 2020 to 30 September based on 15% of the estimated total tax liability (Previously 50%) 2. Second Provisional Tax Payment due from 1 April to 31 March based on 65% of the estimated total tax liability (Previously 100%) 3. Portion of first and second provisional payments deferred above, payable when third provisional tax payment becomes due in order to avoid penalties and interest. For Micro Businesses this payment must be made on the date specified in the notice of assessment However, interest and penalties will apply in instances where, upon assessment, it is discovered that a taxpayer does not qualify for relief under the proposed amendments. | Deals with exposure risks and workplace controls | - Total temporary disablement - Suspected cases self-quarantine (employer responsible) - Confirmed cases if Fund accept liability, will pay for 30 days - Medical aid - Death benefit Can be contracted as employee in workplace or as part of travel | From 1 May 2020, there will be a four-month holiday for skills development levy contributions (1 per cent of total salaries) to assist all businesses with cash flow. | Smaller VAT vendors that are in a net refund position will be temporarily permitted to file monthly instead of once every two months, thereby unlocking the input tax refund faster and immediately helping with cash-flow. SARS is working towards having its systems in place to allow this in May 2020 for Category A vendors that would otherwise only file in June 2020. | The filing requirement and the first carbon tax payment are due by 31 July 2020. To provide additional time to complete the first return, as well as cash flow relief in the short term, and to allow for the utilisation of carbon offsets as administered by the Department of Mineral Resources and Energy, the filing and payment date will be delayed to 31 October 2020 | Due to the restrictions on the sale of alcoholic beverages and tobacco products, payments due in May 2020 and June 2020 will be deferred by 150 days and payments due in August 2020 and September 2020 will be deferred by 90 days to assist compliant businesses in respect of payments of excise taxes on alcohol, to more closely align tax payments through the duty-at-source system (excise duties are imposed at the point of production) with retail sales. | The 2020 Budget announced measures to broaden the corporate income tax base by (i) restricting net interest expense deductions to 30 per cent of earnings; and (ii) limiting the use of assessed losses carried forward to 80 per cent of taxable income. Both measures were to be effective for years of assessment commencing on or after 1 January 2021. These measures will be postponed to at least 1 January 2022. | The tax-deductible limit for donations (currently 10 per cent of taxable income) will be increased by an additional 10 per cent for donations to the Solidarity Fund during the 2020/21 tax year Adjusting pay-as-you-earn for donations made through the employer: Employers can factor in donations of up to 5 per cent of an employee’s monthly salary when calculating the monthly employees’ tax to be withheld. An additional percentage that can be factored in of up to 33.3 per cent, depending on the employee’s circumstances, will be provided for a limited period for donations to the Solidarity Fund. This will lessen cash flow constraints for employees who donate to the Solidarity Fund | Individuals who receive funds from a living annuity will temporarily be allowed to immediately either increase (up to a maximum of 20 per cent from 17.5 per cent) or decrease (down to a minimum of 0.5 per cent from 2.5 per cent) the proportion they receive as annuity income, instead of waiting up to one year until their next contract “anniversary date”. This will assist individuals who either need cash flow immediately or who do not want to be forced to sell after their investments have underperformed. |
| Requirements | 1.Only for employees earning > R6 500 under the ETI 2.Tax compliant employer | 1.Normal ETI rules; 2.Tax compliant employer | 1. Gross Income < 100 million; 2. Gross income not include more than 10% passive income 3. Any Companies, trusts, partnerships or individuals which conduct a trade 4. Tax Compliant 5. Registeres as employer with SARS by 1 March 2020 | 1. Gross Income < 50 million; 2. Gross income not include more than 10% passive income 3. Any Companies, trusts, partnerships or individuals which conduct a trade 4. Tax CompliantMicro Businessesas defined do not need to comply with point 1 and 2 | - Employers report W.CL.1 - Notice of occupational disease and claim for compensation W.CL.14 - Exposure and medical questionnaire - First medical report W.CL.22 indicating U07.1 as code - Exposure history W.CL 110 - Medical report - Progress medical report W.CL.26 - Final medical report W.CL.26 - Affidavit | ||||||||
| Effective date | 1 April 2020 and ending on 31 July 2020 | 1 April 2020 and ending on 31 July 2020 | 4 months effective from 1 April 2020 to 31 July 2020 (for Payments due on 7 May 2020 to 7 August 2020) | 1 April 2020 to 31 March 2021 | 20 March 2020 | 01-May-20 | 01-May-20 | Due by 31 July 2020 | Due in May 2020 and June 2020 | ||||
| Administrative matters | The full employees’ tax liability withheld or deducted from remuneration must be declared on the EMP 201, only 65% (Previously 80%) of the employees’ tax liability must be PAID by the relevant due dates | The amount that must be declared on the IRP6 is the total estimated tax liability (that is, as per normal process 100%), only PAY 15% (first provisional tax period) of the estimated tax liability or 65% (second provisional tax period) of the estimated tax liability reduced by the first provisional tax payment paid, by the relevant due dates. | |||||||||||
| Guide | Click here | Click here | Click here | Click here | Click here | ||||||||
| Claims | Online claims Compensation Fund CompEasy (www.labour.gov.za) Rand Mutual Assurance CompCare (www.randmutual.co.za) Federated Employers Mutual IMS (httos://roe.fem.co.za) Manual claims Compensation Fund covid19claims@labour.gov.za Rand Mutual Assurance contactcentre@randmutual.co.za Federated Employers Mutual FEM Registry@fema.co.za |