Included earnings in remuneration when determining the maximum allowable tax exempt contribution?
A. Functionality Applicable before 01 March 2016: Currently wage type /112, Retirement Funding Income is used as the basis for determining the tax exempt pension fund contributions. Wage type /113, Non-Retirement Funding Income is the basis used for determining tax exempt retirement annuity contributions. Provident Fund contributions were not tax exempt.
Effective 01 March 2016, cumulate all income codes to technical WT /112 which is the total remuneration, based on the Fourth Schedule.
Customer Action: This was initially intended to be a customer action however SAP has taken the decision to cumulate the SARS income codes to /112 in the payroll program. This will be included in phase 2. No action required from customers except implementation of relevant SAP and Support Package.
|Fourth Schedule Remuneration|
All amounts received from employer in respect of employment including value of taxable benefits, allowances and share gains