SARS Unemployment Insurance Fund : South African Revenue Service
Organisation : South African Revenue Service (SARS)
Facility Name : Unemployment Insurance Fund
Country : South Africa
Website : https://www.sars.gov.za/types-of-tax/unemployment-insurance-fund/
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What is SARS Unemployment Insurance Fund?
The Unemployment Insurance Fund (UIF) gives short-term relief to workers when they become unemployed or are unable to work because of maternity, adoption and parental leave, or illness. It also provides relief to the dependants of a deceased contributor.
The unemployment insurance system in South Africa is governed by the following legislation:
** Unemployment Insurance Act, 2001 (the UI Act)
** Unemployment Insurance Contributions Act, 2002 (the UIC Act)
These Acts provide for the benefits, to which contributors are allowed, and the imposition and collection of the contributions to the UIF, respectively, and came into operation on 1 April 2002.
Who are Eligible For SARS Unemployment Insurance Fund?
All employees, as well as their employers, are responsible for contributions to the UIF.
However, an employee is excluded from contributing to the UIF if he or she:
** Is employed by the employer for less than 24 hours a month
** Is employed as an officer or employee in the national or provincial sphere of Government
** Is the President, Deputy President, a Minister, Deputy Minister, a member of the National Assembly, a permanent delegate to the National Council of Provinces, a Premier, a member of an Executive Council or a member of a provincial legislature or
** Is a member of a municipal council, a traditional leader, a member of a provincial House of Traditional Leaders and a member of the Council of Traditional Leaders.
How To Register For SARS Unemployment Insurance Fund?
Any employer, who is registered with SARS for Employees’ Tax, also needs to register to pay UIF contributions. You can register once for all different tax types using the client information system.
The following employers must register at the UI Commissioner’s office for purposes of paying UIF contributions, an employer who:
** Doesn’t need to register with SARS for Employees’ Tax purposes
** Hasn’t voluntarily registered with SARS as an employer
** Isn’t liable for the payment of the skills development levy.
** Pays or is liable to pay remuneration to an employee must contribute on a monthly basis to the UI Fund.
How Much Do You Need To Pay?
** The amount of the contribution due by an employee, must be 1% of the remuneration paid by the employer to the employee.
** The employer must pay a total contribution of 2% (1% contributed by the employee and 1% contributed by the employer) within the prescribed period.
** A contribution shall not apply to so much of the remuneration paid or payable by an employer to an employee, as exceeds:
** With effect from 1 October 2012 – R 14 872 per month (R 178 464 annually)
** With effect from 1 June 2021 – R 17 712 per month (R 212 544 annually).
Please Note:
As from 1 June 2021, the maximum earnings ceiling is R17 712 per month or R212 544 annually. For employees who earn more than this amount, the contribution is calculated using the maximum earnings ceiling amount. Therefore the maximum contribution which can be deducted, for employees who earn more than R17 712 per month, is R177,12 per month.