What to do when you as an employer did not make UIF contributions and wants to settle the UIF arrears and paying from now on every month?
If you did not submit and pay over UIF since 1 April 2003, there are penalties (10% of the UIF amount due) and interest (which is calculated daily only by the finance department of the UIF, as there are fluctuations)
The process is as follows: (PAYROLL 4 SA CAN ASSIST YOU HEREIN)
- Register yourself and your employee for UIF
- Get a UIF reference number
- Submit the information to the UIF for the periods you did not submit or pay UIF (Only one form per year is needed for backlog periods, thereafter you need to submit a form every month)
- Only after you have submitted the salary information for the backlog periods, the finance department of the UIF can calculate what the amount for interest will be.
- In the meanwhile you can calculate the penalties, here is an example:
Your domestic worker STARTED to work for you from 1 January 2010 (this is the actual start date) and earned R2000 per month from 1 January 2010 until 31 December 2010. Therefore for this period the 2% UIF contribution which you did not pay was R40 per month x 12 months = R480 UIF for the 12 month period. Plus 10% of R480 = R48. This R480+R48 = R528. You owe the UIF R528 for 2010. This amount is the actual UIF (R480) plus the 10% penalty (R48) = R528.
NOW your domestic worker got an increase on 1 January 2011. Her salary for the next 12 months was R2200 per month. The same process as above needs to be done for the next period (until she got another increase)
2011: Monthly salary R2200
UIF contribution per month R44
UIF contribution for period (in this case 12 months) R44 x 12 months = R528
10% penalty: R52.80
UIF + penalty (R528 + R52.80) = R580.80
Thus you owe the UIF R580.80 for the 2011 period
2010: You owe R528
2011: You owe R580.80
2012: You owe R600 (imaginary amount)
Total you owe the UIF: R1708.80
2013: Start to pay each month and submit salary information each month!
If your domestic worker got an increase every 6 months, you need to calculate the 6 month period as above.
- The next step is to start submitting and paying EVERY MONTH as soon as possible.
- As soon as the finance department of the UIF has calculated the penalties and interest, you can make the payment for the amount due.
PAYROLL 4 SA can assist you with
- Registering with the UIF
- Register on U-filing
- Sorting out backlog payments / settling the UIF arrears (This is not done via U-filing but on the manual system)
- Submitting monthly declarations before the 7th of each month for the previous month via U-filing
- Declaring your monthly UIF payment for contributions to the UIF which you have made to the UIF directly
- Providing monthly payslips to your domestic worker
- E-mail : email@example.com
- Call us TODAY to get peace of mind!