Chapter 14
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Unemployment benefits (UIF)
An employer must register all employees for UIF with SARS. Every month the employer must deduct UIF from the employee’s wages which is 1% of the employee’s wage. The employer must make an equal contribution of 1% of the employee’s wages and send the money to the Department of Employment and Labour (See Unemployment Insurance Fund). For information on how to register or make a payment, or to download the relevant forms for registrations, declarations and payment, look at the following website which is linked to the Department of Employment and Labour: www.ufiling.gov.za. The information that follows is based on information contained in this website. If the employer is registered for PAYE this will be done on the EMP201 submission to SARS.
WHO MUST CONTRIBUTE TO UIF?
The Unemployment Insurance Act (No 63 of 2001) and Unemployment Insurance Contributions Act apply to all employers and employees, but not to –
- Employees working less than 24 hours a month for an employer
- Learners
- Public servants
- Foreigners working on contract
- Employees who get a monthly old age grant or
- Employees who only earn commission or do piece work
EXAMPLE
Zama cuts patterns for dresses. He pays Trevor to sew the pieces together. Trevor works from his house. Trevor is not employed by Zama and Zama cannot deduct deduct tax or UIF from the money he pays Trevor.
Domestic employers and their employees are included under the Act and must contribute to the UIF.
A working member of a close corporation or working director of a company must now pay UIF. All employees who earn above an amount of R254 372 per year (R21 198 per month) have to pay 1% of their earnings to UIF, but only up to this ceiling amount. For example, if Fred earns R35 000 per month, he will have to pay 1% of R21 198 and not 1% of R35 000. If Fred wants to claim UIF in the future he will only be paid a percentage of R21 198 and not a percentage of his salary.
The employer cannot claim money from the UIF if the business fails and has to close down.
WHO MUST REGISTER FOR UIF?
All employers must register either with SARS or directly with the Unemployment Insurance Fund.
Employers must register directly with the UIF unless they –
- Are required to register as employers under the Income Tax Act, or
- Pay the skills development levy under the Skills Development Act.
Employers who are required to register their employees with SARS for the payment of PAYE (Pay As You Earn) and/or SDL (Skills Development Levy) must register with SARS for their UIF.
HOW TO REGISTER FOR UIF
There are various ways to register with the UIF. (See Chart: Ways to register for UIF)
It is the employer’s responsibility to fill in and send the forms to register themselves and their employees.
The quickest way to register for UIF is to do it online using the UIF uFiling portal. This allows you to manage all of your UIF contributions and requirements, register employees for UIF when you hire them, and make your payments.
Every employee will be registered on an electronic database system and their details and contributions to the UIF will be recorded. Every time a new employee is employed the employer must register this person on the UIF database.
An unemployed person wanting to apply for UIF will only have to present their bar-coded ID document to receive unemployment payments.
| WAYS TO REGISTER FOR UIF | |
| MANNER OF REGISTRATION | STEPS |
| uFiling | Step 1: Get the necessary information ready. get information like the ID numbers and addresses of employers and employees ready before registering. Step 2: Complete the online registration. go to the website: www.ufiling.gov.za (set up by the Department of Employment and Labour) and complete the online registration forms for commercial employees and for employers of domestic workers all employees, including farm workers and domestic workers. |
| Via e-mail | Step 1: Get the Form UI-8 and UI-19 (for business employers) or the UI-8D and UI-19D (for domestic employers) from the website: www.ufiling.gov.za Step 2: Fill in the forms for both yourself and your employees. The form for the registration of employees asks for an employer reference number. If you do not have a reference number yet, you can leave this part open. The UIF will create a reference number and send it to you. Also ignore the part asking for a signature. Step 3: e-Mail the forms to:Commercial Employers: webmaster@uif.gov.za.Domestic Employers: domestics@uif.gov.za. |
| By telephone | Step 1: Get the necessary information ready. get information like the ID numbers and addresses of employers and employees ready before phoning the UIF. Step 2: Phone the UIF on (012) 337 1680 and follow the instructions of the UIF official. |
| By fax | Step 1: Call the UIF fax line from your fax machine on 086 712 2000 and follow the voice prompts. Wait for the forms to be faxed to you. Step 2: Fill in the forms both of yourself and your employees. The form for the registration of employees asks for an employer reference number. If you do not have a reference number yet, you can leave this part open. The UIF will create a reference number and send it to you. Step 3: Fax the completed forms back to the UIF at 086 713 3000 |
| By mail | Step 1: Get the Form UI-8 and UI-19 (for business employers) or the UI-8D and UI-19D (for domestic employers) from the website or at any Employment Office. Step 2: Fill in the forms for both yourself and your employees. The form for the registration of employees asks for an employer reference number. If you do not have a reference number yet, you can leave this part open. The UIF will create a reference number and send it to you. Step 3: Mail the forms to: The UIF Pretoria 0052 (Postage is payable on all mail sent) |
| At a Labour Office | Step 1: Get the necessary information ready. get information like the ID numbers and addresses of employers and employees ready before registering. Step 2: Get the Form UI-8 and UI-19 (for business employers) or the UI-8D and UI-19D (for domestic employers) from the website or at any Employment Office. Step 3: Fill in the forms for both yourself and your employees. The form for the registration of employees asks for an employer reference number. If you do not have a reference number yet, you can leave this part open. The UIF will create a reference number and send it to you. Step 4: Hand in the forms to the Labour Office staff |
WHAT MUST THE EMPLOYER DO EVERY MONTH?
Once you have registered yourself and your employees with the UIF, you must do the following:
- Deduct 1% of every employee’s salary
- Add another 1% for every employee – this is paid by the employer
- Pay the 2% contribution every month to the SARS or UIF
- Declare any new employees or change in an employee’s salary to the UIF
HOW TO PAY THE UIF
There are various ways to pay the UIF (see chart below). It is your responsibility as an employer to deduct money from your employees and pay it and your own contributions to the UIF or SARS.
| WAYS TO PAY FOR THE UIF | ||
| METHOD OF PAYMENT | STEPS | BANKS THROUGH WHICH PAYMENT CAN BE MADE |
| uFiling | Go to the UIF website: www ufiling.gov.za where you can submit your returns and declarations and make UIF payments. | |
| Stop Order | Step 1: Go to your bank and fill in the forms they give you to pay the money into the UIF account. Ask the bank to use your employer reference number as reference. Step 2: Send the payment advice. The UIF sends employers the payment advice form every month. You can also get it on the website. Complete this form when you pay and send it in one of the following ways: – Mail to: UIF Pretoria 0052 – Fax to: (012) 337 1931 – Email to: enquiries@uif.gov.za | FNB (employers of domestic employees only) Account number: 62052400547 Branch code: 25-31-45 FNB (commercial employers) Account number: 51420056941 Branch code: 25-31-45 ABSA (all employers) Account number: 4055481885 Branch code: 32-31-45 STANDARD BANK(all employers) Account number: 010032185 Branch code: 00-45CDI No: 0068730083641 NEDBANK (all employers) Account number: 1454041560 Branch code: 14-54-05 The name of the Account Holder is: Unemployment Insurance Fund |
| Internet Banking | Step 1: Set the UIF up as a beneficiary. Use your employer reference number as the recipient reference. Step 2: Send the payment advice. The UIF sends employers the payment advice form every month. You can also get it on the website. Complete this form when you pay and send it in one of the following ways: – Mail to: UIF Pretoria 0052 – Fax to: (012) 337 1931 – Email to: enquiries@uif.gov.za | |
DECLARING NEW EMPLOYEES
Employers must also inform the UIF of changes (for example, new employees appointed or changes in salary) before the 7th of every month.
If you are using uFIling (the UIF online portal) you can use this to declare new employees. Or you can mail, fax or e-mail the UI-19 or UI-19D forms or do the declarations online. If employers want to send declarations they must use the following steps:
Step 1: Fill in the form
Employers must fill in the UI-19 or UI-19D form (the same form you use to register employees) with the new details for employees. The forms are available at your nearest employment office or on the website. You can also do the declarations online.
Step 2: Send in the form
Employers can send the form to the UIF by:
- Mailing it to: UIF, Pretoria 0052
- Faxing it to: 0866492012
- Emailing it to: domestics@uif.gov.za if you are an employer of a domestic worker or enquiries@uif.gov.za if you are a commercial employer.
Employers with electronic payroll systems must send their information to declarations@uif.gov.za
