Tricky Terms
You know that expression ‘It’s all Greek to me?”
Well, think of me as your translator and let’s uncover the secrets of the finance world together, Indiana Jones-style.
IRP5
Certificate issued at the end of each tax year by an employer to employees showing the amount of PAYE deducted from the employee’s salary and paid across to SARS on the employee’s behalf.
IRP6
Provisional tax return due to SARS at the end of August and end of February each year. Each covering 50% of the total tax liability of a taxpayer for a specific tax year.
IT3(a)
Similar to an IRP5, but issued in cases where a salary was paid to an employee, but no PAYE was deducted and paid across to SARS on behalf of the employee.
IT3(b)
Tax certificate issued mostly by financial institutions confirming the total amount of interest earned by a taxpayer for a specific tax year.
IT3(c)
Tax certificate issued by financial institutions, confirming the amount of any capital gains/losses for a taxpayer for a specific tax year.
VAT201
The return a registered VAT vendor needs to submit to SARS (usually bi-monthly) to declare and pay across to SARS the VAT charged on sales for a specific period.
EMP201
The return an employer needs to submit to SARS on a monthly basis to declare and pay across to SARS the PAYE and UIF deducted from employees for a specific month.
EMP501
The reconciliation done twice per year (around September and May) between an employer’s payroll records, and the monthly EMP201 submissions to SARS.
IT12
The annual income tax return to be submitted by individual taxpayers declaring their income and qualifying deductions for a specific tax year.
IT14
Similar to an IT12, but this return is for the submission of registered companies and close corporations.
IT34
The assessment SARS issued once they reviewed an IT12 or IT14, showing the total tax liability for a specific tax year, and reflecting any amount still payable/in some cases refundable back to the taxpayer.
PAYE
Pay as you earn – the tax that gets deducted off an employee’s salary on a monthly basis before their salary is paid into their bank account. The amount of PAYE is calculated based on certain tables published by SARS on an annual basis.
UIF
Unemployment insurance fund – a compulsory 1% deduction (capped at a certain amount) that needs to be deducted off an employee’s salary and paid across to the Department of Labour. The UIF provides maternity benefits and in cases where employment is ended due to retrenchment for example.
