What Is The SARS Tax Procedure When An Employee Dies?



Working individuals in South Africa are expected to pay a tax on their return for as long as their professional careers remain active. However, what happens to these tax obligations when an employee dies?



The South African Revenue Services (SARS) is the South African body responsible for collecting tax from its citizens. If you are a full time employed South African earning upwards of about R95 000 a year, you might have noticed a SARS Pay As You Earn (PAYE) deduction in your monthly salary statement.

Though many South Africans are subject to tax payment, a lot of the time, they may not entirely understand what they are contributing to. As stated on the SARS website, the payment of tax “enables the Government to meet the social and economic needs of our country and its people”.

The PAYE deduction, which varies depending on how much the individual employee earns, contributes towards this attempt to cater to citizens’ needs. This deduction is included as a legal responsibility of the employer’s, alongside deductions towards Skills Development Levy (SDL) and the Unemployment Insurance Fund (UIF). 

The SDL amount is dedicated towards the funding of skills development for the employee, whilst the UIF amount can be claimed when an employee becomes unemployed, providing them with temporary relief whilst they are unable to work. Failing to deduct the Paye amount for SARS leaves the employer liable to paying a fine or serving time in imprisonment.

So what happens if an employee passes on?

When an employee passes on, the employer still maintains a final obligation towards the deceased employee’s tax.  The employer is responsible for producing the former employee’s tax certificate to whomever is acting as the representative taxpayer on their behalf within 14 days of their passing.

The tax certificate includes the amount of income earned by the employee, and how much tax was deducted monthly. If an employer is unable to produce a tax certificate, the executor will be tasked with having to reach out to SARS for guidance on how to move forward. 

After that, the executor is left responsible for tying up all of the deceased employee’s tax affairs, and is therefore also responsible for ensuring that they receive the tax certificate. 

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