We are all familiar with the annual cycle of business income tax returns.

Well, in the same way, all employers must submit annual returns to the Compensation Fund.
From the returns that you submit, together with the nature of your business, the Compensation Commissioner determines your annual “premiums”. In other words, you are “assessed” – and you become liable to pay the assessed amount.

In order to be correctly assessed, the Compensation Fund requires:

1. The correct nature of your business. If you are incorrectly classified, you may be inserted into a category that is riskier and pays a higher assessment “rate”.
2. The correct value of the wages and salaries you pay your staff, management and directors.

Since 2014, the Compensation Fund has made it possible to submit your annual returns electronically at www.labour.gov.za. 
We strongly endorse this move and, in fact, when we submit annual returns for our clients, we do so on the Department of Labour website. However, this is our business and we know to navigate the pitfalls, some of which are:

1. If a mistake is made during the capturing process, it is a mission of gargantuan proportions to have it corrected. There is no electronic means to make a correction. Mistakes can only be fixed by standing in a long queue (which is even longer during the Return of Earnings cycle from March to May every year) and personally convincing a bureaucrat, face-to-face of the error;
2. Immediately that the return of earnings is submitted, the clock starts ticking for the assessment to be paid – within30 days. If you add an unwanted zero somewhere, you could easily end up having to pay ten times more than the correct amount. And we all know the policy: “pay first, fix later”. The problem is that it can take years to fix the mistake. And, when fixed, you could end up with a credit (which could last you eight years) instead of a cash refund!
3. If the earnings that are reported drop by too much from the previous year (it’s our secret as to what that threshold is), the system will not allow you to submit your return. You will have to personally explain why there is a discrepancy;
4. Employers OFTEN make the mistake of reporting “earnings” that exceed the annual threshold. The Compensation Fund provides income cover up to a certain income level. If you include in your return the amounts in excess of the threshold (which changes EVERY year), you are over-reporting and, if you find out that you over-reported, you will struggle no end to get it corrected;
5. If an employer has gaps in its return of earnings history, it will not be able to submit the current year’s return. If an employer submits all the historical returns at once, it will become immediately liable for all of them all at once;

So, if you retain us to submit your return of earnings, we will help you too to navigate these obstacles. We will:

• Look into your history and compare it with your proposed current return. If the current return is out of line, we will enquire from you and then advise you on the next steps. In this way, we have saved numerous employers millions of rands (literally) by preventing them from over-paying;
• Advise you whether there are any gaps in your history and, if so, how to ensure that you don’t put yourself out of business catching up the old cycles;
• Inform you in advance of the amount for which you will be due;
• Assist you in obtaining installment arrangements (additional fee applies) if the amount to be paid is too large for you to afford in one lump sum;
• Inform you if you are behind with any of your assessments;
• If you give us a description of your nature of business, we will be able to see whether you are correctly registered. If you are incorrectly classified, we can help you to correct this. If the correct classification is more expensive, we will not force you to change the registration but we will inform YOU thereof nonetheless. (An additional fee applies to give effect to the correction, if applicable.)

So, as you can see, there are many good reasons to hand over your return of earnings submissions to us.

Entrust this sometimes tricky (and sometimes also unpleasant) job to us.

Not only will we handle it quickly and efficiently for you but it will probably be done more accurately and with considerably less risk to your peace of mind and your cashflow.

(Note that the price for this service applies to only one year’s Return of Earnings. Contact us for pricing if more than one year must be submitted or if corrections are required.)