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DISCLAIMERThis document includes amendments to the Income Tax Act (1962) up to and including theTaxation Laws Amendment Act 2012. It also includes the proposed budget changes althoughthese had not yet been promulgated at the time of printingAlthough care has been taken with the preparation of this document, VIP makes nowarranties or representations as to the suitability of quality of the documentation or its fitnessfor any purpose and the client uses this information entirely at own risk.The purpose of this document is to address employees’ tax and only include references toincome tax where applicable.COPYRIGHT NOTICE© Copyright 2013 by Sage VIP, a division of Sage South Africa (Pty) Ltd hereinafter referred toas “VIP”, under the Copyright Law of the Republic of South Africa.No part of this publication may be reproduced in any form or by any means without theexpress permission in writing from VIP.
Table of Contents1. Terminology 62. Definitions & Employees’ Tax Concepts 62.1 Employer 72.2 Employee 72.2.1 Labour Broker 72.2.2 Personal Service Provider (PSP) 82.2.3 Independent Contractors and “Deemed Employees” 92.3 Remuneration 92.3.1 Balance of Remuneration 112.3.2 Net Remuneration 112.3.3 Deemed Remuneration and Directors of Private Companies 122.4 Residence Based Taxation 132.4.1 Ordinarily Resident 132.4.2 Deemed Resident - Physical Presence Test 132.5 Standard Employment and Temporary Employees 142.6 Directives 143. Allowances, Advances, Reimbursements and Other Remuneration 153.1 Allowance 153.2 Advance 153.3 Reimbursement 153.4 Travel Allowance 153.4.1 Reimbursive Travel Allowance 163.4.2 Estimating a Travel Allowance for an Employee 173.4.3 Establishing the Rate per Kilometre of the Vehicle 173.4.4 Travel Allowance on Assessment 193.5 Subsistence Allowance 193.6 Share Incentive Schemes 203.6.1 Taxation of Gains made in respect of Rights toAquire Marketable Securities 203.6.2 Taxation of Broad-Based Employee Share Plans 203.6.3 Taxation of Vesting of Equity Instruments 213.7 Arbitration Awards 213.8 Lump Sum Payments - Gratuities due toRetrenchment, Retirement or Death 213.9 Back Pay (Antedated Salaries) 224. Exempt Income 224.1 Uniform Allowance 224.2 Relocation Allowance 234.3 Foreign Employment Income 244.4 Bursaries and Scholarships 244.5 Lump Sum Compensation for Occupational Death 24
Page 3: Payroll Pocket Guideas at March 201
Page 8 and 9: 1. TERMINOLOGYAll references to ‘
Page 10 and 11: 2.2.2 Personal Service Providers (P
Page 12 and 13: pension, superannuation allowance,
Page 14 and 15: 2.3.3 Deemed Remuneration and Direc
Page 16 and 17: 2.5 Standard Employment and Tempora
Page 18 and 19: Private travel includes travelling
Page 20 and 21: Value of the Vehicle(including VAT)
Page 22 and 23: Subsistence allowances for travel o
Page 24 and 25: 3.9 Back Pay (Antedated Salaries)Ba
Page 26 and 27: 4.3 Foreign Employment Income (Sect
Page 28 and 29: PensionThe total annual deduction a
Page 30 and 31: 6.1 Acquisition of an Asset at Less
Page 32 and 33: The fringe benefit value placed on
Page 34 and 35: A “room” does not only include
Page 36 and 37: The repurchase rate may change duri
Page 38 and 39: Note that any subscriptions paid to
Page 40 and 41: 9.2 Exempt IncomeExempt income is i
Page 42 and 43: • employees who work less than 24
Page 44 and 45: 11.2 EmployeeAn employee, for skill
Page 46 and 47: • where the employee is remunerat
Page 48 and 49: To report foreign income, add a val
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