In my clients financial in expenses, the total salaries (Net plus paye/uif/sdl) is declared as an expense. On the SD I reconciled the PAYE and salaries to financials. Now SARS raised an additional assessment stating that PAYE in not a deduction according
Important:
This answer is based on tax law for the tax year ending 28 February 2020.
Answer:
The amount of employees’ tax, the PAYE, is an amount that is withheld by the employer from the amount due to the individual employee in respect of services rendered. The total remuneration will qualify to be deducted under section 11(a), unless it is capital in nature. The employees’ tax is therefore not a separate expense, but part of the total employment expense.
It is possible (unlikely) that the employees’ tax, in this instance, may well not be the tax withheld from remuneration in the year of assessment. We don’t have enough information to comment on that. We suggest that you request reasons for the assessment here.