SARS implemented a wonderful incentive for entrepreneurs to employ & empower young workers in the workplace. If used effectively it can be very beneficial to business owners. This is called employment tax incentives or ETI in short. Some industries can be more beneficial than others.
Construction or manufacturing for example, is some of the businesses that already employ many. When planned, the company can end up with a huge amount of available ETI’s available every month.
Who qualifies for an employment tax Incentive?
Employers with the following applicable:
How does this work?
In your weekly & fortnightly wages and monthly salaries of each month you calculate the ETI for each qualified employee. On the 7th of the following month you must submit your PAYE / UIF return (called EMP 201) to SARS.
In this return you calculate the total of your PAYE payable to SARS and may deduct the available ETI’s from this amount before making the payment to SARS.
The deduction is available for a 24-month period for each employee that qualify and available as incentive until 28 February 2019. I trust this article will assist you in making an informed decision when looking to employ younger people in the work place.
Feel free to contact us for more information and monthly accounting and tax assistance.