South African employers are required to submit their EMP501 Annual Reconciliation for the 2020/2021 tax year, to the South African Revenue Authority (SARS).
Details of the reconciliation period will be confirmed by SARS, but the submission period usually runs until the end of May each year. Click here to view the PAYE page on the SARS website, for more details.

Here are a few tips to help you prepare for the upcoming submission (click on the links to expand on a topic should you want to read more):

• Your current payroll version must be either on Release 5.5a or Release 5.5b to create the IRP5 file for import into SARS e@syFile. Not on the correct release? Visit the Sage VIP Customer Zone for update software

• Validate your company information on each tab of the Basic Company Information Screen. All reference numbers and submission details must be verified.

• Verify the company dates on the Period Info screen. Confirm the processing period, tax year start and end dates, pay period in the tax year, number of weeks in the month etc.

• If you are in the final period of the tax year, ensure that the company is flagged for tax year-end

• Ensure that all earnings, deductions, and company contribution definitions are setup correctly – Validate the IRP5 codes and taxability thereof on the Earning Definitions and Deduction Definition screens

• Validate all your employee information by using the Flexi Fixed Info utility - SARS requires employers to provide the correct employee banking and contact details, as well as employee Income Tax Reference numbers

• Validate Additional Information on the payroll

• Print the IRP5/IT3a Validation report to identify possible errors. Printing the IRP5 Validation report. Find solutions to any validation error by accessing SageKB.com

TIP: Choose your payroll product to refine the search

• Generate the EMP501 Reconciliation History report to reconcile with your EMP201 declarations and payments on eFiling. This makes it easier to quickly identify any irregularities that might have changed your payroll values during the current tax year

• Reconcile ETI values if your company has claimed. Print the EMP501 Reconciliation History report to list month by month ETI values. The ETI Validation Report (Real number 767 on Reports and Maintenance) should have been printed each month.

TIP: Make use of the ETI Validation Tool (not available for Sage 200c VIP) which was recently introduced. It will help you verify your ETI setup, perform corrections and create an import file for easy import into the payroll. Read more about this tool here.

 Important: ETI not utilised cannot be carried into the new tax year. Validate your ETI before the end of February 2021!

• Print the Negative YTD report (also available during Start New Period process) Ensure you do not have any negative values per IRP5 code. Your IRP5 file will be rejected if negative values appear against any IRP5 code

• Print the Reimbursive Travel History report to identify errors

• Make a copy system/copy instance when your companies are in the final period of the tax year