Conquer SARS Compliance: What Every Business Owner Needs to Track

As a business owner in South Africa, navigating compliance with the South African Revenue Service (SARS) is non-negotiable. Missing deadlines or making inaccurate submissions can lead to penalties, interest, and unnecessary stress. The key to staying compliant and maintaining a healthy business lies in rigorous record-keeping and a rock-solid understanding of what you need to track.

Essential Submissions to Keep on Your Radar

Depending on your business structure and whether you are registered as an employer or for VAT, you’ll have a set of recurring SARS submissions. These are the main ones that demand your attention:

• 1. Pay-As-You-Earn (PAYE), Skills Development Levy (SDL), and Unemployment Insurance Fund (UIF) – The EMP201:
  • If you employ staff, you must submit a monthly EMP201 return to declare the tax (PAYE), SDL, and UIF deducted from your employees’ salaries, along with the company’s SDL and UIF contributions.
  • What to track: Accurate monthly payroll data, including all employee earnings, deductions, and tax calculations.
  • Deadline: Generally, the 7th of the following month (or the last business day before the 7th if it falls on a weekend or public holiday).
• 2. Employer Reconciliation (EMP501):
  • This is a bi-annual reconciliation of your monthly EMP201 submissions, comparing the declarations with the tax certificates (IRP5/IT3(a)s) issued to employees.
  • What to track: A record of all monthly EMP201 submissions and payments, and the final tax certificate data for employees.
  • Deadlines: There is an Interim Reconciliation (typically August to October) and an Annual Reconciliation (typically March to May).
• 3. Value-Added Tax (VAT) – The VAT201:
  • If your business is registered for VAT, you must submit a VAT201 return. This declares your output VAT (VAT charged on sales) and input VAT (VAT claimed on purchases).
  • What to track: All sales and expense invoices, specifically noting the VAT component, and a detailed VAT control account reconciliation.
  • Deadline: Usually on or before the 25th of the month following the end of the VAT period (or the last business day before the 25th). Submission frequency can be monthly, bi-monthly, or even every six months, depending on your registration category.
• 4. Corporate Income Tax (CIT) – The ITR14:
  • Every company must submit an annual ITR14 income tax return, declaring its income and expenses for the financial year.
  • What to track: Full financial statements (Income Statement and Balance Sheet), trial balances, asset registers, and supporting documentation for all income and claimed expenses.
  • Deadline: Within 12 months of the company’s financial year-end.
• 5. Provisional Tax (IRP6):
  • Provisional taxpayers (which most companies are) must estimate their taxable income for the year and make two main payments toward their annual tax liability during the year.
  • What to track: Your estimated taxable income and calculation of the tax payable for the first and second provisional periods.
  • Deadlines: The first provisional payment is due six months into your year of assessment, and the second payment is due on the last day of the year of assessment. A third, ‘top-up’ payment is optional.

The Crucial Need for Good Record Keeping

Beyond just knowing the deadlines, a business owner needs to ensure their records are impeccable. SARS relies on your information being accurate, complete, and verifiable. Key records to maintain include:

• Source Documents: All invoices, receipts, bank statements, and contracts.
• Payroll Records: Detailed employee salary registers, leave records, and calculations for all statutory deductions.
• Asset Register: A list of business assets, including purchase date, cost, and depreciation calculations.
• Financial Statements: Up-to-date monthly and annual financial reports.

Accurate record-keeping is your first line of defense against penalties and is vital for completing your submissions accurately.

⏰ Streamline Your Compliance with Technology

Managing these various dates, forms, and documents can be overwhelming. This is where modern payroll and accounting software becomes your most valuable partner.

Panda Payroll offers a solution to ensure you never miss a deadline again. Their software is built with compliance in mind and includes a fantastic feature:

🐼 Panda Payroll has a built-in Payroll Calendar to remind you of these important SARS dates!

This calendar helps you stay ahead of the monthly EMP201 submissions, the bi-annual EMP501 reconciliations, and other key financial deadlines, providing peace of mind that your compliance is under control.

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Visit https://pss-group.co.za and sign up for a 30-day free trial today!