Strategic tax planning for your business
January 10, 2017Employers who are registered for Employee’s Tax (PAYE) with SARS and are tax compliant qualify for this incentive. The incentive can only be claimed in respect of a qualifying employee.
A person is considered a qualifying employee if he/she –
- has a valid South African ID
- is at least 18 years old but not reached the age of 30
- is not a domestic worker
- is not related or connected to the employed
- earns at least minimum wage
- earns less than R6,000 per month in remuneration
- is newly employed on or after 1 October 2013
An incentive up to R1,000 per qualifying employee per month is available for a period of 24 months. Employers may claim this incentive by reducing the monthly PAYE payable to SARS.
Penalties up to 100% of the incentive amount claimed will be levied if an employer incorrectly claims this incentive. Furthermore the shortfall of PAYE paid will also attract penalties and interest. Where an employer displaces an employee in order to employ an eligible individual, a penalty of R30,000 is payable. This incentive is available until 31 December 2016.
