Employers have from 18 April 2017 until 31 May 2017 to submit their Annual Reconciliation Declarations (EMP501) for the period 1 March 2016 to 28 February 2017.

The 4th Schedule to the Income Tax Act places the following obligations on all employers who are registered at SARS for Pay-as-you-earn (PAYE), Unemployment Insurance Fund (UIF) or Skills Development Levy (SDL):

  • Must issue employees with an IRP5/IT3(a) where remuneration is paid or has become payable
  • Must submit all reconciliation documents to SARS within the prescribed period

The Employer Annual Reconciliation Declaration is important because it is a way of making sure that the monthly declarations (EMP201’s) which have been submitted during the year are accurate and that they tie up to the payments made, as well as to the IRP5 / IT3(a) certificates issued and ETI (if applicable).

The Annual Reconciliation Declarations (EMP501) must show details of the total amount of:

  • Employees’ Tax [Pay-As-You-Earn (PAYE)]
  • Skills Development Levy (SDL)
  • Unemployment Insurance Fund (UIF)
  • Employment Tax Incentive (ETI) deducted or withheld
  • Details of Employee Tax certificates [IRP5/IT3(a)s] issued during the tax year

The Annual Reconciliation Declaration must be submitted electronically to SARS by the due date.  Penalties and interest will be charged on:

  • Non-submission of the Employer Annual Reconciliation (EMP501) on or before the due date
  • Non-submission of employee IRP5 / IT3(a) certificates
  • Submission of incorrect or inaccurate data relating to the IRP5 / IT3(a) certificates

Should you have any questions or need any help with your Employer Annual Reconciliation, please do not hesitate to contact us.