Payroll services

in South Africa

Payroll services in South Africa

Our offices in Cape Town and Johannesburg can assist with all your HR & Payroll administration. Are you a small business without a dedicated Payroll department? Perhaps you are a large multinational corporation needing Payroll services for a South African branch of your company? Maybe your company would simply like to mitigate the risk involved with internal Payroll and administration, by outsourcing your Payroll and accounting needs to an independent third party, such as TMF South Africa. Your company can focus on its core business while we ensure accurate Payroll and accounting records are maintained and are compliant with SARS and the South African Department of Labour.

South African Payroll services are governed by three main laws:

Income Tax Act (Act No. 58 Of 1962)

The government’s main source of revenue is the tax levied on all taxpayers’ income (companies, trusts and individuals). The period of assessment is 12 months commencing on 1 March and ending on 28/29 February. There are three main methods for paying tax on monthly income:

  • PAYE (Pay-As-You-Earn) ensures that an individuals’ tax liability is collected at the same time the income is earned.
  • Provisional Tax allows taxpayers who earn income in addition to a salary to pay the tax on their additional income halfway through the financial year and again at the financial year end.

Unemployment Insurance Fund (UIF) Amended Act (Act No. 32 of 2003)

The Unemployment Insurance Fund serves to alleviate the social and economic strain caused by unemployment. According to the act, both employer and employee must register for UIF and make monthly contributions to the fund. This applies to all employees except those working less than 24 hours per month for an employer, learners, public servants, foreigners working on contract, any employees who receive a monthly state pension or employees earning commission. The act states that employer and employee must each pay the equivalent of 1% of the employee’s salary to the fund each month.

Skills Development Levies (SDL) Act (Act No. 9 of 1999)

An employer is obliged register as a skills development levy payer when cumulative salaries are expected to be over R500,000 for the year. This levy is paid to the National Skills fund and is used to enrich and develop skills of employees. According to the act, employers must pay 1% of the total amount paid in salaries on a monthly basis to the South African Revenue Service (SARS).

Our team of professional accountants can manage the full scope of payroll processing including:

  • Registrations
  • On-going compliance
  • Electronic payslips
  • Annual leave calculations
  • Employees tax calculations (PAYE)
  • Monthly UIF and SDL calculations
  • Workman’s Compensation (WCA)
  • Reconciliations
  • Paying agent

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