N5 Entrepreneurship


484 001 – 617 000 128 400 + 38% of taxable income above 484 000 617 001 and above 178 940 + 40% of taxable income above 617 000


290 001 – 410 000 67 260 + 35% of the amount above 290 000 410 001 – 525 000 109 260 + 38% of the amount above 410 000 525 001 and above 152 960 + 40% of the amount above 525 000


Tax Rebates Primary R9 756 Additional (Persons 65 and older) R5 400


Tax Thresholds Below age 65: R54 200 Age 65 and over: R84 200


DID YOU KNOW


Employees earning below R63 556 per annum are still not legally required to apply for registration with Sars, and employees who earn less than R120 000 a year from one employer and have no extra income and deductions don’t need to submit a tax return.


5.2 Fringe benefits for employees


The following are compulsory employee benefits: • UIF – the Unemployment Insurance Fund provides insurance for employees who contribute to the fund for loss of income when they lose their jobs. One percent of the gross income of workers must be deducted. The employer must contribute the same amount.


• Workmen’s Compensation – all workers must be registered and the business must pay their contribution. This fund provides for insurance cover against the loss of income as a result of injury or death of a worker while on duty.


The following are voluntary employee benefits: • Pension funds – most employers make provision for pension benefits for their employees when they retire.


• Medical aid schemes – medical aid schemes make provision for employees and their dependants for the payment of medical costs.


Motor car allowances, bonuses and the provision of meals are other benefits that are often part of salary packages.


Determination of minimum wage


Minimum wages are usually negotiated for each industry between the relevant trade unions and employers’ organisations.


Steps in calculating a monthly salary for an employee: • Decide between a salary and/or a commission. Sales people and taxi drivers normally get a commission to motivate them to work harder.


• Decide what your business can afford. Consult the salary section in the Income Statement of the business. Try to determine how much current employees are earning. Also look at the net profit of the business. A profit suggest that that money can either be paid to the owners in the form of dividends or being used to employ a new worker.


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