FAQ’s
COMMON FAQS?
TAX
Why am I not being taxed at 25%?
As per SARS guidelines, independent contractors are taxed as per the SARS tax tables, unless
– They have a valid SARS tax directive
– They work less than 22 hours per week, for every week they are on a production
Why do I get taxed more when I work as a daily?
When an employee’s tax period is shorter than a full tax year, an annual equivalent needs to be calculated in order to determine which tax bracket is applicable.
The annual equivalent is the projected amount of income that an employee would earn in a year based on the income earned for a specific period (monthly, weekly or daily).
This is calculated by multiplying the employee’s earnings by either 12 (monthly), or 52 (weekly), or 7 and 52 (daily).
Daily tax tables are used when a person is employed for less than a complete week. SARS have not issued daily tax tables, therefore the tax is calculated from the weekly earnings equivalent.
When an employee works for a complete week and is paid weekly, the SARS weekly tax tables are used. A complete tax week is normally 7 days, however if a company has two off days a week, then the five day period is deemed a complete week.
Are my other forms of income subject to PAYE?
Vehicle and equipment allowances are not subject to PAYE. However, the independent contractor must declare these incomes in their annual tax returns.
Cellphone, meal and travel allowances are subject to PAYE, unless the crew member provides proof of these production expenses.
UIF
What is the UIF?
The unemployment insurance fund gives short-term relief to workers when they become unemployed or are unable to work because of illness, maternity or adoption leave. It also provides relief to dependants of a deceased contributor.
Who is responsible for paying UIF contributions every month?
All employees, as well as their employers are responsible for contributions to the UIF. Employees are excluded from contributing to the UIF if he or she
- Is employed for less than 24 hours a month
- Is a public servant
- Is a learner
- Is a foreigner working on contract
- Is an independent contractor
When can I claim from the UIF?
UIF benefits are only available to you if you have been contributing to the UIF while you worked. You cannot claim if you have resigned, been suspended or absconded from work. You can claim if you are unable to work due to sickness, have gone on maternity leave, been retrenched or your employer has cut your working hours.
WORKING PERMITS
What types of permits allow me to work?
- Valid general work visa
- Valid refugee/asylum seeker permit
- Permanent residence
- Valid study visa (may not work more than 22 hours in any week)
- Valid retired persons’ visa
What types of permits do not allow me to work?
- Temporary relatives visa
- Visitors/tourist visa
- Medical visa
- Expired permits
PERSONAL SERVICES PROVIDERS
Are personal service companies taxed?
28% PAYE is to be deducted from any Personal Service Company, which includes Close Corporations. The crew member’s company would be deemed to be a Personal Service Company if any of the following scenarios apply:
- The person rendering the service would be regarded as an employee of the client had such service been performed directly to the client; and
- The person rendering the service is subject to the control and supervision of the client as to the manner in which the duties are performed or as to the hours of work; or
- The amounts paid or payable for the person’s services consist of or include earnings of any description which are payable on regular daily, weekly, monthly or other intervals; or
- Where more than 80% of the income of the company is derived during the year of assessment from one client.
When would a company not be taxed?
In the case where the Personal Service Company has more than three full time employees who are not related to the members or shareholders, no PAYE will be deducted. These companies will need to provide us with paperwork proving this.
IRP5s
When are IRP5s ready for the latest tax year?
IRP5s are ready from the middle of each year for the previous tax year. Please check the SARS website for tax season dates.
How do I get my IRP5?
If you are registered for SARS e-Filing, your IRP5s will automatically upload to your profile once we do our annual submissions. If any are missing from your profile or you do not have access to e-Filing, you can contact us on irp5@reelpay.co.za or click on the above link to fill out an IRP5 request form.
If you do not have an agent, please keep a complete list of the jobs you have worked on for the full tax year.
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