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Thread: CC Members

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    Question CC Members

    Hi, please can somebody direct me. We are a CC with two members only operating since Jan 2011.Our salaries drawn for last year were only R30 000 each and it was not monthly as the year was slow, so when we could we took a salary. Do we have to paye , uif on this amount etc as we are below the threshold. No deductions were taken off because I was unaware I should as we are members.What should be deducted when we are able to take a salary , and do we file a personal IT12 for the amounts taken as a salary . Can somebody direct me .

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    Gold Member daveob's Avatar
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    to the best of my understanding, your cc membership status is not relevant. What does count is if you are an employee of your (own) cc - in other words if you receive a salary from the cc. In this case you pay paye for the salary if above threshold. UIF should be paid on all salary ( including members salary ) upto a certain ceiling. I don't believe that UIF has a minimum threshold and should be deducted and paid from the salary you draw.

    The company should issue you with a year end IRP5 ( if PAYE paid ) or an IT3A if no PAYE deducted. Use e-Filing to submit the monthly PAYE / UIF returns, and easyFiling to submit the bi-annual returns and create the IRP5 / IT3A's

    Suggest you get your accountant involved.
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    Site Caretaker Dave A's Avatar
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    I may be out of date, but it used to be you could only register a cc for PAYE if it employed someone who earned an income above the tax threshold. And that is certainly not the case here.

    If that is still true, making payments for UIF via eFiling is not an option; you would then file the returns and pay via uFiling.

    So I guess the question is - does a cc have to register for PAYE even if it doesn't employ anyone earning enough to warrant a PAYE deduction?

    Anyone know for sure what the current position is?
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    connie (02-Mar-12)

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    Daveob is right. You were supposed to have paid UIF and submitted tax returns and all those other exciting forms he mentioned. You would not have had to pay PAYE though as at R30k / year you are below the threshold of paying PAYE.

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    connie (02-Mar-12)

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    Quote Originally Posted by Dave A View Post
    So I guess the question is - does a cc have to register for PAYE even if it doesn't employ anyone earning enough to warrant a PAYE deduction?

    Anyone know for sure what the current position is?
    I have a pty registered for PAYE and paying UIF on efiling, but none of the employees have reached the PAYE payment level yet. So it is possible, but whether you have to or not, I don't know.

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    Dave A (02-Mar-12)

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    Email problem BusNavig8's Avatar
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    In terms of the Act all members/Directors are deemed to be employees.

    In terms of the registration requirements, a registration for PAYE is only done where there is a liability or an anticipated liability for PAYE/SDL in the next 12 months.

    An employer should only be registered for UIF with SARS if he is registered for PAYE and/or SDL with SARS.
    Should an employer be registered with SARS only for UIF, and there is no prospect of becoming liable for PAYE and/or SDL payments in the near future, the employer should register with the UIF Commissioner instead and deregister with SARS.

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    BusFact (02-Mar-12)

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    Regarding an ITR12 you will have to submit an ITR12 irrespective of the income received for the year. (The R120 000 rule is not deemed to apply in this case)

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    Quote Originally Posted by BusNavig8 View Post
    In terms of the Act all members/Directors are deemed to be employees.
    That's interesting. Is it still the case even if the director does not draw a salary or any funds from the company at all?

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    connie (12-Mar-12)

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    Quote Originally Posted by BusFact View Post
    That's interesting. Is it still the case even if the director does not draw a salary or any funds from the company at all?
    If he/she is tax registered and is due to submit a return to SARS and does not they may incur Admin Penalties of R250 per month per year of non compliance. In such circumstances I would advise to ascertain whether the taxpayer is tax registered are whether a return a due. A nil return will then need to be submitted.

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    connie (12-Mar-12)

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    In this particular case, there are two directors who are mainly employed elsewhere and submit their tax returns. The company for which they are directors does not pay them any fees (yet) and has no employees, so it hasn't registered for UIF, PAYE, COID, etc - which would be nil returns anyway.

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    connie (12-Mar-12)

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