News Flash 13 January 2017 – South Africa – Taxation Laws Amendment Bill signed into Law

President Jacob Zuma has signed into law, the following Bills:

Taxation Laws Amendment Act

The Taxation Laws Amendment Act make the following changes effective:

Employment Tax Incentive (ETI)

• The expiry date for ETI has been extended until 28 February 2019. (Effective date 01 October 2016)
• The definition of monthly remuneration was amended to read “where an employer employs and remunerates a qualifying employee for at least 160 hours in a month..”.

This means unpaid hours (e.g. unpaid leave) will no longer be counted towards the 160 hours to determine a full month. (Effective date 01 October 2016)

• A single employer will not be allowed to claim more than R20 million ETI per tax year. (Effective date 01 March 2017)
• Limit on back-dated claims. Monthly claims can only be made up to the date of each 6-monthly reconciliation. After that no further claims for that specific reconciliation period will be allowed. (Effective date 01 March 2017)

Learnership allowances (incentive)

• The period for the allowance has been extended to 31 March 2022. (Effective 01 October 2016 and applies to Learnership agreements entered on or after that date)
• The tax deduction value will be based on the NQF level of the learner.
• For learners with a qualification equal to NQF level 1 – 6, the employer qualifies for an annual deduction of R40 000.
• For learners with a qualification equal to NQF level 7 – 10, the employer qualifies for an annual deduction of R20 000.
• For learners with a disability, and a qualification equal to NQF level 1 – 6, the employer qualifies for an additional annual deduction of R20 000.

For learners with a disability, and a qualification equal to NQF level 7 – 10, the employer qualifies for an additional annual deduction of R30 000.

Unemployment Insurance Amendment Act, 2016

• Extension of unemployment insurance benefits to learners who are undergoing Learnership training.
• UIF benefits increased from 238 days to 365 days.
• Maternity leave benefits increased to 66%.
• Payment of maternity benefits may not affect the payment of unemployment benefits.
• Employees who lost working hours due to reduced time at their work places, will be entitled to benefits.
• Families and/or nominated beneficiaries of a deceased claimant will be allowed to receive the deceased’s benefits.

Charging of fees by any party (e.g. agency) to a UIF claimant for helping them submit their claims, are prohibited.

 

Contact our legislation team at info@crs.co.za if you require any additional information.

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