It is important for all employers to know that Unemployment Insurance (UIF) is regulated by legislation which states that all employers must register for UIF.
The exception to this rule is if a business has
- Employees working less than 24 hours a month;
- Learners under a learnership as defined in the Skills Development Act;
- Foreigners working on a contract basis who will, after expiration of their contract, leave the country;
- Workers who only earn commission
Therefore every employee except those mentioned above, must be registered for UIF by the employer. You are probably wondering if you need a UIF registration form or complete the process through an UIF online registration process. Want to take the guess work out of registering your company for UIF. At Express registration we will take care of your UIF registration process for you!
The Purpose of UIF Registration
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. UIF alleviate the harmful economic and social effect of unemployment.
The monthly contribution for UIF is 2%of your worker’s gross salary per month. Employers must deduct 1%of your worker’s gross salary per month, and you as the employer contributes 1%.
What is the difference between a SARS UIF number and a Department of Labour (DOL) UIF number and why your business should be registered for both
Any employer, who is registered with SARS for Employees’ Tax, also needs to register to pay UIF contributions. The employer will therefore have two UIF numbers; one from the Department of labour (example 123456/8), and one from SARS who will pay the UIF over to the department of labour monthly. The SARS UIF reference number is the same as the PAYE number, but the 7 at the beginning of the number is replaced with a ‘U’.
Only employers not required to register for Employees Tax (PAYE) may register with the department of labour only; for example, an individual who employs a domestic worker. Please refer to “When must an employer register for Employees’ Tax”.
The employer must calculate 2% of the employee’s remuneration (refer to sources of income on which UIF is not paid) and submit it with the EMP201 to SARS.
An employer must also submit an electronic declaration to the department of labour on a monthly basis. The declaration will contain the details of the UIF calculations so that the UIF contributions per employee reflects on the UIF system.
Sounds complicated? Let the Express Team assist you with a Payroll solution that includes all the PAYE and UIF compliance.
Domestic Workers must also be registered with UIF DOL; however, their payments are done annually or bi-annually.
The Express Team can assist with most UIF registrations and services, which includes
- UIF Department of Labour Registration
- UIF (PAYE) SARS Registration
- U-filling Registrations
- U-filling Reporting
- Payroll Administration and Maintenance
- Submitting of UIF Reports and Corrections
- Domestic Worker UIF Registration and Payments
- Various HR services are also available
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