Your tax compliance is essential in helping SARS fulfill its mission of enabling the state to support the well-being of all South Africans. As part of our commitment to improving taxpayer services, SARS continues to enhance processes for a smoother, more efficient experience.

This newsletter outlines key information to help you meet your tax obligations during the Employer Annual Declaration period (1 April – 31 May 2025).

Employer Tax Compliance Starts with You

During this period, employers must submit their annual reconciliation declarations (EMP501) with accurate and up-to-date payroll information. Your EMP501 must include:

• EMP201 declarations for PAYE, UIF, and SDL contributions.
• Details of payments made (excluding penalties and interest).
• Employee tax certificates (IRP5/IT3[a]) for the tax year 1 March 2024 – 28 February 2025.

Register Employees for Income Tax

Employers are responsible for registering employees who are not yet registered for Income Tax. You can do this using:

• Individual ITREG – For a single employee.
• Bundled ITREG – For multiple employees.

Both options are available via e@syFile™ Employer

What’s New?

SARS has launched e@syFile™ Employer version 8.0, designed to enhance the reconciliation and filing process. This upgraded version ensures:

✔ Improved efficiency and usability.
✔ A smoother experience for employers, tax practitioners, and payroll administrators.

We encourage you to download the latest e@syFile™ Employer software from the SARS website (www.sars.gov.za) before submitting your declarations.

Why Filing Accurately and On Time Matters

The employer reconciliation process is a critical step before the Income Tax Filing Season later in the year. The information submitted during this period helps SARS auto-assess or pre-populate employee tax returns (ITR12).

Incomplete or incorrect submissions may delay your employees’ ability to file their tax returns. Ensure timely distribution of IRP5 and IT3 certificates, as employees need them to complete their tax filings.

Avoid Penalties for Non-Compliance

Late or incomplete EMP501 submissions will result in penalties:
1% of the total PAYE liability per month, increasing up to a maximum of 10%.

What Constitutes a Criminal Offence?

Employers who wilfully or negligently fail to comply may face serious consequences, including fines or imprisonment for up to two years. Offences include:

• Failure to submit complete EMP201 or EMP501 returns by the due date.
• Not issuing IRP5 or IT3(a) certificates to employees on time.
• Failing to deduct or pay over PAYE or UIF as required by law.
• Using PAYE deducted from employees for any other purpose.

How to File Your EMP501

Employers with 1 to 50 employees can:

• File an EMP501 using SARS eFiling or e@syFile™ Employer.
• Create tax certificates from payroll and import them via SARS eFiling.
• Change, cancel, or manually capture certificates on SARS eFiling (if less than 50 certificates).

Employers with more than 50 employees:

• must file an EMP501 using e@syFile™ Employer.

Check the Status of Your Submission

To confirm that your EMP501 has been successfully filed, monitor your submission status. If a submission is rejected due to missing or incorrect data, it is considered not submitted, and penalties may apply.

Keep Employee Records

Employers must maintain a register of employee details and financial records for at least five years after submission. These records must be made available for SARS review if requested.

Need More Information?

For guidance on completing manual certificates, refer to:
e@syFile™ Employer User Guide
Step-by-Step Guide to the Employer Reconciliation Process on www.sars.gov.za.

Watch our tutorial on SARS TV (@sarstax):
“How to Submit an Employer Annual PAYE Reconciliation EMP501.“

Thank you to all employers who comply with their tax obligatio.Your commitment plays a vital role in supporting South Africa’s economy and development.

Kind Regards CPI Support Team