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FAQ Question: How do I setup the Employer Tax Incentive within Sage Pastel Payroll & HR? Solution: Step 1 If the employer is eligible to claim ETI, the setup is as below: 1. Select Setup Company Parameters 2. Select the Statutory Tab 3. Ensure the company s PAYE reference number is inserted 4. Select Eligible to Claim ETI 2018 Update 1 Page 2 of 7
5. Select the correct Standard Industry Classification Code (SIC) for the company 6. Select OK to save the changes. 7. The following message will display: 8. Select Yes to copy the selected SIC code for the company to all Employee Masterfiles. Note: If you select No, you must select a SIC code for each employee individually. We suggest you select Yes and then only amend the employees where the SIC code differs from the company classification. Step 2 Which employees may be included in the ETI rebate calculation? 1. The employee s start date must be 01 October 2013 or later. 2. The employee must be between 18 and 29 years old. 3. The employee must be an individual with Nature of Person A, C, M or R. 4. The employee must earn at least the industry prescribed minimum wage or R2000 if no prescribed wage rate exists. ETI Setup Page 3 of 7
5. Go to Edit Employee Masterfile Statutory Details 6. Ensure that the Standard Industry Classification Code is selected. 7. Go to Employee Masterfile Statutory ETI Note: Employment Date: Purpose: The initial date of the employee being employed by the company or associated company as per ETI Act. Validation: Employment Date must be after employee s date of birth, it can be before current start date however it cannot be after current start date. If employment date is before 01/10/2013 employee no longer qualifies for ETI. If you open the data for the first time on 2018 Update 2a it will default to employee's Start Date. 8. Enter the minimum wage rate for the selected employee as prescribed by the specific industry. If no minimum wage rate is prescribed, enter 2000.00 in the Minimum Wage field. Note: Wage Regulatory Measure Select the block if your minimum wage is the industry prescribed minimum wage, if it is R2000 as per the BCEA then it should not be selected. 9. Select Employee Qualifies for ETI ETI Setup Page 4 of 7
Note: Apply 2nd Year ETI Calculations will only be valid once you have submitted an ETI claim for 12 months for a selected employee. After 12 months worth of ETI claims, you need to start applying the second year calculations. If ETI has been claimed for the employee for 24 months, ensure Completed ETI is elected. Step 3 Calculate the ETI rebate value The ETI rebate will be calculated when you process a Payroll Run. The following calculations will be applied: 1. For each of the first 12 months that an employee qualifies, ETI will be calculated as follows: a. 50% of gross remuneration up to R2000 per month b. R1000 if gross remuneration is between R2000 and R4000 per month c. If gross remuneration is between R4000 and R6000 per month, ETI is calculated as R1000 [0.5*(monthly remuneration 4000)] d. If gross remuneration exceeds R6000 per month, ETI will be zero ETI Setup Page 5 of 7
2. For each of the second 12 months that an employee qualifies, ETI will be calculated as follows: a. 25% of gross remuneration up to R2000 per month b. R500 if gross remuneration is between R2000 and R4000 per month c. If gross remuneration is between R4000 and R6000 per month, ETI is calculated as R500 [0.25*(monthly remuneration 4000)] d. If gross remuneration exceeds R6000 per month, ETI will be zero 3. Go to View Statutory reports EMP201 ETI Report 4. Ensure your employees are listed on the right hand side, beneath Employees to Process Select OK 5. Ensure to select the month for which you wish to print the report 6. The following screen is displayed. 7. This report will give you a breakdown of all information related to ETI per employee, per month. You will also be able to see the remuneration figures used in the ETI calculation as well as the ETI result per month. Step 4 Submit your ETI claim 1. Go to View Statutory Reports EMP201 EMP201 Monthly Declaration 2. Ensure your employees are listed on the right hand side, beneath Employees to Process 3. Select OK 4. The following screen is displayed. ETI Setup Page 6 of 7
Note: A section has been added to the EMP201 report to include the ETI rebate claim. Step 5 Temporary Employees 1. If you have temporary employees, paid by Basic Salary, please ensure to include Transaction code 5003 Hours Worked on the Payslip. 2. Transaction code 5003 may be used to capture the actual number of hours worked for employees who receive a salary or fixed amount not calculated according to time worked. Note: From 2018 Update 1b Transaction code 5017 ETI Premium hours will be added to your Default tab of the Process Payslips screen, once a legislative release has been run to ensure all additional hours are reported. This transaction code is not an Income code and therefore does not affect your Payslip in any way. ETI Setup Page 7 of 7