Setting up Business in Swaziland 06. Employees
6. EMPLOYEES
6.1 In respect of both a company and a branch, with which government agencies would the company/branch have to register as an employer? Could you assist in this regard, and at what cost?
The company will have to register as an employer with the Commissioner of Taxes.
Our office in Mbabane can assist in this regard.
6.2 Are there obligations resting with the company/branch to withhold tax from salaries and to pay this to the Department of Taxes? What are the filing requirements?
· Yes, a Final Deduction System ("FDS") has been implemented. All employees are subject to this system, provided they have not derived any other taxable income during the year of assessment. The employee is not required to furnish an income tax return if his or her income consists wholly of employment income, which is subject to the FDS. FDS however relates to a full year of employment. Employees who commence employment during the year or who change employers will have to file a tax return.
· An employer will have to deduct employees’ tax from any remuneration paid to an employee (in accordance with the tables).
· The employer has to furnish an employees' tax certificate to the employees. The employees' tax certificate will include a certificate to be signed by the employee certifying that income reflected on the IRP5 is or not his/her only taxable income for the tax year.
· The Swazi rates of taxes applicable to employees are as follows:
Taxable Income Tax
More Than But not Exceeding
0 30 000 0
30 000 45 000 3 600 + 20% of excess over 30 000
45 000 60 000 6 600 + 25% of excess over 45 000
60 000 75 000 10 350 + 30% of excess over 60 000
75 000 14 850 + 33% of excess over 75 000
· It has been proposed that the tax bands be amended and we are currently awaiting approval by Cabinet.
The Swazi income tax legislation provides for a standard rebates of E2 400 per tax year..
· Individuals in Swaziland are generally taxed at a rated 10% at source on dividend and interest receipts. This is a final tax.
6.3 Are there statutory requirements regarding minimum wages?
Yes - minimum wages are governed by the Wages Act. These are detailed and vary from industry to industry.
6.4 Would the employer be required to contribute to social security, pension fund, medical aid fund and unemployment insurance on behalf of employees? Would this apply to non-resident employees as well?
Are there any other compulsory contributions the employer would need to make?
Graded tax - see 4.1 above.
Swaziland National Provident Fund(SNPF) contributions are required to be deducted from the employee’s pay and each month (currently E50) and remitted to the Fund with a similar contribution by the employer.
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