IMPORTANT CHANGES & REMINDER: UIF, BUSINESS TRAVEL REIMBURSEMENTS & COIDA SUBMISSION
Foreign Nationals and UIF
Does your organisation employ a foreign national?
Our experience is that many nonprofit organisations do employ the services of foreign nationals, whether on fixed terms contracts, learnerships or for the duration of projects.
Prior to March 2018, foreign nationals were not required to make contributions to the Unemployment Insurance Fund (“the Fund”) as they would be repatriated at the end of their service/contract.
However, from March 2018, such individuals are now required to make contributions to the Fund, as is the employing organisation. This therefore impacts on the budget of the organisation.
Please ensure that your organisation’s payroll administrator is aware of this significant change and so complies with the new legislation.
[Note that a similar change applies to learners who are employed by the organisation according to section 18(2) of the Skills Development Act.]
Prior to March 2018, the amount an organisation paid an employee (rate per km) for the use of her/his private vehicle was not included in the definition of remuneration and therefore not subjected to employees’ tax (PAYE). If the rate paid exceeded SARS’ prescribed rate for the particular tax year, the amount paid to the employee was subjected to tax on assessment.
However, from March 2018, the definition of remuneration now includes 100% of the amount by which the reimbursed travel costs exceed the amount calculated at SARS’ maximum (prescribed) rate, regardless of the total “business” kilometres travelled. The prescribed rate for 2019 is R3.61 per kilometre. By way of example, if an employee travels 200 kilometres on business and is reimbursed at R4.00 per kilometre, s/he will receive R800.00, of which R78.00 ([R4.00 – R3.61] x 200) will be subject to employees’ tax.
COIDA 2017 Return of Earnings
Please remember that all employers must submit their COIDA 2017/2018 return of earnings by 31 May 2018. The Compensation for Occupational Injuries and Diseases Act, No 130 of 1993 (COIDA) provides for compensation for disablement caused by occupational injuries or diseases sustained or contracted by employees in the course of their employment, or for death resulting from such injuries or diseases.
Employers are required to submit a Return of Earnings form (W.As.8) on an annual basis. The Department of Labour has announced that the 2017/2018 submissions can now be submitted and that the closing date is 31 May 2018.
Please let us know if you need assistance with your submission – there is no exemption for non-profit organisations!