The blog post today is aimed at trying to provide some much needed clarity on the TERS process. These changes, as outlined in a recent UIF update letter, were first introduced in our blog post from 5 October. The content of this blog post is taken from and summarises the UIF’s official update letter dated 14 October, sent to all employers.
Our post today covers:
- how to determine salary and remuneration paid on applications;
- the finer details of the bank verification step;
- an update on foreign national applications; and
- a reminder of how to end service on SimplePay.
1.a – How to Determine the Correct Monthly Salary to Declare
The monthly salary column of your TERS CSV, should reflect the aggregate of the wage and fringe benefits you pay to each of your employees. As SimplePay pre-populates this column, provided your employee’s salary information is correct, there’s nothing further to worry about. It is worth noting that if this value is not accurate, the UIF has introduced a new verification step.
The UIF is cross referencing the “taxable earnings” value for your employees’ March 2020 uFiling submission, in order to ensure that salaries are not inflated. If the values differ, the lower value will be used for the calculation of TERS benefits.
This is not a retrospective change, meaning it will only be applied to applications that have been processed from 3 September onwards. The change will though apply to all applications past this date, regardless of the lockdown period to which they relate. Unfortunately, even if you had legitimate reasons for increasing an employee’s salary, there is no way to apply to receive the higher sum that this would yield.
1.b – What is the Correct Value for Remuneration?
To answer this question, it helps to take one step back. An employee is entitled to TERS benefits where he or she earns a reduced salary due to:
- business closure;
- comorbidities (an illness which puts the employee at an increased risk);
- reduced working hours; or
- having to take a temporary reduction of salary due to operational requirements.
Any of your employees satisfying the above can receive TERS benefits. Importantly though, where your employees receive remuneration in addition to TERS benefits for any given period, this needs to be recorded. This is because the aggregate of the TERS payment, plus the reduced remuneration paid by you cannot be greater than the amount the employee would ordinarily earn. Because of this, it’s important you know what falls under remuneration.
The UIF has clarified that all amounts / payslip components that would normally count as remuneration are included, except for loans, advances and payments related to leave taken.
2. Bank Verification
As part of the improvements to the TERS process, bank verification steps have been introduced. To help avoid delays it is important that you provide correct banking information.
Some of the most common reasons for the failure of bank verification include:
- The incorrect Personal ID number is used. This should be that of the bank account holder. If it is a joint account, you should ensure that it is the primary holder’s ID used.
- If the bank account is held in a trade name, it is important that it matches the bank account’s name.
- If the bank account includes special characters, these should be used
- Do not include any “t/a” sections of the bank account information
- If the account’s name is in Afrikaans, this is how it should appear
Single Bank Account for Several UIF Entities
If you have several companies that pay into one bank account and you wish to claim TERS benefits to all the employees of the different companies, you will need to use the “Trade Name Verification” option to verify these UIF entities.
On the TERS portal, you will need to change all of your companies’ names to match the company name stated on the bank account. This will mean that you will have more than one UIF entity with the same name on the TERS portal, but also allows you to apply for benefits for all employees.
If you are at all unsure about this we would encourage you to get in touch with the UIF on 0800 030 007.
3. Foreign Nationals Update
The UIF has said that it’s currently working with the Department of Home Affairs to verify the foreign nationals. No payments will be made until the UIF has verified individuals’ identities, but it hopes it will manage this within the next fortnight.
Foreign nationals must be declared via uFiling, regardless of whether you submitted their declarations to the UIF using SimplePay.
How To Change Existing Applications
If you now realise that there’s an issue with one or more of your applications, this can be done using the UIF’s discrepancy function. Corrections can only be made once per employee, per application period so it’s crucial that you make the amendments carefully and accurately.
The discrepancy functionality is open for claims made up to and including the July / August application period, and will open in due course for the later lockdown periods.
How To End Service on SimplePay
It is important to correctly reflect your employees’ current working status on SimplePay for several reasons. Having this information allows:
- SimplePay to provide you with accurate auto filled TERS CSVs;
- you to make correct submissions to SARS;
- Your employees to claim UIF where necessary; and
- Reduces your monthly charge to the number of active employees
To allow for SimplePay to provide you with accurate auto filled TERS CSVs, make correct submissions to SARS and reduce your monthly premium to an appropriate amount, it is important to correctly reflect your employees’ current status on SimplePay.
For a reminder of how to end an employee’s service on SimplePay, you can read this previous blog post.
We hope that this information has proved useful to you. If you have any questions on how the information above relates to SimplePay, please feel free to contact us at [email protected]
Equally, if you are not yet a client of SimplePay but would like to be, why not try out our service free? You can sign up for your free 30-day trial here, get to grips with our user-friendly service by reading our getting started page, or try our free online course. Concerned about cost? Don’t be; we’ve simplified that too – check out our pricing page. Alternatively, you can request a formal quote if you need one here.
Keep well and stay safe.