The Employment Tax Incentive (ETI) is a South African government incentive designed to encourage employers to hire and retain qualifying young employees. The incentive allows eligible employers to reduce the amount of PAYE they are required to pay to SARS.
ETI is calculated based on specific employee and employment criteria, including factors such as the employee's age, remuneration, and employment status. When an employee qualifies, the applicable ETI amount is calculated during the payroll process and can reduce the employer's PAYE liability.
Key points:
ETI applies only to employees who meet the qualifying requirements.
Employee age and remuneration are important factors when determining eligibility.
The incentive is calculated as part of the payroll process.
Eligible ETI amounts reduce the employer's PAYE liability.
Employers must ensure that employee information is accurate to support the correct ETI calculation.
ETI is subject to the applicable SARS legislation and requirements.