News FlashesApril 3, 2020CRS News Flash 2 April 2020 – SOUTH AFRICA – COVID-19 Tax Measures Update and SARS PAYE BRS version 19.01

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APRIL 2020 – SOUTH AFRICA

COVID-19 TAX MEASURES and SARS PAYE BRS version 19.01

It is important that employers note the following:

COVID-19 Draft Tax Bills published for public comment

National Treasury and the South African Revenue Service (SARS) have published the 2020 Draft Disaster Management Tax Relief Bill and the 2020 Draft Disaster Management Tax Relief Administration Bill for public comment.

These draft Bills provide for a comprehensive description of the proposed amendments required to implement the COVID-19 tax measures.

The Draft Disaster Management Tax Relief Administration Bill, 2020 provides for the following tax measures:

  • Deferral of employees’ tax
  • Deferral of provisional tax
  • Deferral of interim payments by micro business
  • Extension of time periods

The Draft Disaster Management Tax Relief Bill, 2020 provides for the following:

  • Tax relief in respect of the COVID-19 pandemic
  • The tax treatment of certain trusts for tax relief in respect of the COVID-19 pandemic
  • Non-withholding of employees’ tax for tax relief in respect of the COVID-19 pandemic
  • The amendment of the Employment Tax Incentive Act, 2013Summary of the Explanatory Memorandum on the Draft Disaster Management Tax Relief Bill
    • Beginning 1 April 2020 and ending 31 July 2020, government will be expanding the Employment Tax Incentive (ETI) programme as follows:
      • The maximum amount of ETI claimable during this four-month period for eligible employees is increased from R1 000 to R1 500 in the first qualifying twelve months and from R500 to R1 000 in the second qualifying twelve months.
      • During this four-month period ETI can also be claimed for employees from the ages:
        • 18 to 29 who are no longer eligible for the ETI as the employer has claimed ETI in respect of those employees for 24 months; and
        • 30 to 65 who are not eligible for the ETI due to their age.
    • The payment of ETI reimbursements will also be accelerated by changing the payment from twice a year to monthly.
    • Postponement of payment of 20% of the PAYE liability, without SARS imposing administrative penalties and interest for the late payment thereof.
    • The postponed PAYE liability must be paid to SARS in equal instalments over the six-month period commencing 1 August 2020, i.e. the first payment must be made on 7 September 2020.
    • Postponement of the payment of provisional tax liability for tax-compliant small to medium-sized businesses.

    Written comments can be forwarded to the National Treasury’s tax policy depository at:

    2020AnnexCProp@treasury.gov.za and Adele Collins at acollins@sars.gov.za by close of business on 15 April 2020.As a result of the tax measures, SARS published an updated PAYE BRS for Employer Reconciliation (2020 release) version 19.01 on 31 March 2020 to make changes to the ETI validation rules.

    To view the draft Bills and Explanatory memorandum, follow the link

Contact our legislation team at info@crs.co.za if you require any additional information.
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