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Biannual PAYE reconciliation

Jan FrankThe first Pay-As-You-Earn (PAYE) biannual conciliation declaration now required by SARS from employers for the six months until 31 August 2010 is underway.

Submitting tax certificates on a biannual basis will assist SARS in streamlining its administrative processes, which will eventually form the backbone for an efficient PAYE and Personal Income Tax system. As a result, the requirements for biannual tax certificates differ from those for tax certificates submitted at the end of a year of assessment.

Some of the relaxed validations are:

  • The income tax reference number on the IRP5/IT3(a) will not be mandatory for the 2010 submission by employers.
  • Employee address details are optional for the 2010 reconciliation.

Biannual tax certificates must not be issued to employees as they are for SARS’s administrative purposes only. The relevant certificate should only be provided to employees whose employment was terminated prior to the closing of the biannual period (due to resignation, death, immigration or an employer ceasing to be an employer).

The new procedure also benefits employers, who will be able to provide a more accurate indication of their PAYE status, identify payment gaps and reconcile and eliminate their own administrative issues on a regular basis.

For information on which critical steps employers should now take, contact Jan Frank at the Somerset West office on tel. 021 852 0382 or e-mail