“The interim reconciliation process has become an integral part of the employer reconciliation and assists employers…” (SARS)
Employers are assisted by the interim EMP501 reconciliation, says SARS, because it makes it easier to:
Of course, there are other benefits, such as maintaining your compliant tax status, and avoiding wasting money on stiff penalties and interest.
It goes without saying that you want to reap all these benefits for your business. Allow us to help you to understand what needs to be done. We will be able to assist in ensuring a smooth, hassle-free submission process – even with the next deadline right around the corner.
EMP501 Reconciliation fast facts
Potential pitfalls
The EMP501 Reconciliation is an intricate process which creates many opportunities for errors:
This is an intricate and time-consuming process, and, as SARS puts it, “accuracy and timely filing are critical”.
Consequences of non-compliance
This is serious business. Inaccuracies or late submission can result in severe consequences.
The bottom line
The penalties are stiff, and the submission process is fraught with opportunities for inaccuracies and errors.
“…it is vital that all stakeholders in the digital ecosystem, including the taxpayers, SARS, and the banks, work together to prevent and combat profile hijacking.” (SARS)
The recent spike in the number of SARS eFiling profiles being hacked by cybercriminals should raise red flags for every taxpayer. It’s got so bad that the Minister of Finance has given the Office of the Tax Ombud (OTO) approval to conduct a review of SARS’ service failures in assisting taxpayers timeously with eFiling profile hijacking.
This is a type of cybercrime in which fraudsters use phishing, malware, or social engineering to access and modify your personal or professional profile on a digital platform like SARS’ eFiling without your knowledge or consent.
Has this ever happened to you?
Fraudsters use methods like these to trick you into revealing your login credentials. An alarming number of taxpayers have fallen victim to these unscrupulous predators, despite continuous system enhancements to secure and strengthen the security of SARS’ channels.
What could happen if my SARS eFiling profile is hacked?
Fraudsters can access and modify your details (e.g. contact number, password) without your knowledge or consent – with serious consequences for your tax compliance and financial security.
They can then also change the bank details to divert a SARS refund due to you into their own accounts. And they can even submit fraudulent returns on your behalf to claim refunds!
How can I prevent profile hijacking?
Prevention is far better than cure. Here are a few pointers, direct from SARS.
We can help to keep you safe
As your accountants, we are well versed in avoiding these scams. Whenever you receive communications that seem to be from SARS, simply contact us.
In summary
SARS itself recognises that profile hijacking is a serious crime that harms taxpayers. But prevention is always better than cure. Take proactive steps to protect your security and contact us whenever you receive communications that seem to be from SARS.
“Beware of little expenses; a small leak will sink a great ship.” (Benjamin Franklin)
When a company is struggling with cashflow, or simply looking to improve profitability, the directors will often consider making grand sweeping changes like retrenching staff, slashing the marketing budget or even selling off resources. While this kind of kneejerk reaction can provide instant gratification, it may not be the solution to your long-term struggles. Cutting back on marketing might impact future sales, for example, and end up making things even worse.
That’s why it’s often a good idea to eliminate small expenses and wasteful expenditures, when you’re looking to streamline cash flow. Here are five simple ways to save money that you may not have considered.
How did your company open its first bank account? Why did you choose that particular bank? If you haven’t thought about these things in a while, now’s a good time to start. The first step would be comparing bank charges – how much are you being charged to transact, and could you be paying less? Your accountant can help you to break down your company’s needs and find the best solution. Do you need to transact every day, or can you save money by paying off your creditors in scheduled payment runs? Would bundled services work better than transacting at will? How many credit cards do you need? Do you use overdraft facilities? The bottom line: stop paying for services you don’t need.
Technology is essential for running a business, but do you need (or even use) everything you currently have? Costs such as software subscriptions, fibre lines and cell phone contracts should all be looked at closely. Do you need a 200Mb/s download or will a 50Mb/s work just as well? Which of your employees really uses their company phones to generate profit? Small businesses will even benefit from looking at their software licences. Many popular work solutions have free, open-source counterparts that work very well and don’t require a monthly payment. Even if you decide you do need to pay for licences, you might be able to cut down on the number of licences.
Monthly utilities may seem like something you can’t go without, but it might be wise to reconsider. Have a look at your work arrangement. Could you operate a shared desk situation for hybrid workers? Have you considered installing flow restriction nozzles on bathroom taps, and LED bulbs in the light fittings? Reducing the size of your office space and then maximising the savings attained on the utilities can save thousands each month – money that could be spent on attracting new clients.
In business, commitment can be a cost-saving. If you have regular suppliers you’re happy with, why not speak to them about longer-term arrangements for cheaper monthly charges? Small business owners are particularly guilty of accepting supplier prices without considering the various ways these can be negotiated. Some of your suppliers might place great value on a one-year contract as opposed to a month-by-month one. Or they may be prepared to throw in free services in exchange for your guaranteed monthly spend. Ask your accountant to take a look at your current supplier arrangements and suggest alternatives and/or ways to reduce costs. It could have a significant impact.
Most big companies have their invoice payment and collection systems down to a fine art – but smaller businesses may not even think about them. Making sure that your creditors settle their invoices long before you need to make payments yourself allows you to benefit from the interest of having money in your account. It also ensures you never have to pay fines for missed payments or become overdrawn. As your accountants, we can help to streamline your payment and collection terms, and potentially achieve some significant savings.
The bottom line
Making cost savings doesn’t need to mean losing clients, products or expertise. And the hacks above are just the tip of the iceberg – there are loads of other small ways to save money. Speak to us about taking the small steps to greater profitability.
