Employment Tax Incentive (ETI) Real Case Study – Tax Free Cash What you don’t know Copyright 2015

ETI in a nutshell – Must haves ETI is for the benefit of the employer and is a reduction in PAYE payable each month to SARS. Employer must be ETI tax compliant Calculated per month per qualifying employee Qualifying employees were employed on or after 1 October 2013, has a green ID Book, younger than 29, and earns less than R6 000 in any month. Can be claimed for a maximum of 24 months for any one employee. ETI is calculated using a formula set out by SARS. Maximum R1 000 per month per employee. ETI claimed with SARS PAYE returns - 28 ETI critical events Copyright 2015

What makes ETI so powerful ETI has many benefits, the most well-known being the credit offset mechanism. You can claim more than your ACTUAL PAYE - i.e. get actual cash back ETI compliance/ Roll overs/ Carry overs, ETI Calculated, ETI utilised, ETI Refund/Reimbursement/Connected person, Displaced employee…… Confused…. Its not your fault The most complicated about ETI is the calculations.! What one of our ETI clients had to say: “Whilst we were unaware of the benefits of ETI, you were very clear regarding the process we had to follow and the benefits that we would derive in submitting the claim. Copyright 2015

ETI Refunds – Challenges if you claim Re-Imbursements. Expect a rigorous audit from SARS, have your audit packs ready and check your calculations. Have access to senior SARS personnel Ensure your staff have sufficient technical knowledge to deal with the refund and answer questions. Know the difference between ETI compliance and a tax clearance certificate compliance. Copyright 2015

Case study, Facts and Results Facts – We started with the claims process February 2015 included 20 periods our claim audited for 2½ months by SARS LBC Megawatt Park by Specialist ETI audit team September 2015 Audit outcome: No Adjustments approved for refund.Client only receives money 2 months later in November Was the ETI claim in the ordinary course of business? – NO! Did anyone know there was an ETI claim until we asked? – NO! Would the client have forfeited their ETI claim without proactive intervention? – YES – Is all this effort really worth it? You decide … Copyright 2015

ETI Refund Analysis Graph The Unclaimed Benefit ETI Credit Offset Copyright 2015

Claiming your reimbursement. Critical! Get the calculations right. We use specialised ETI specific software and are thus compatible with any payroll system. SARS has audited our calculations in detail, no adjustments made. Our ETI system is a stand alone and purpose built. On average our system generates 260 records per employee per month and is not affected by payroll cut-offs or year-ends. It took close on 3 months to secure the clients re-imbursement, physical cash to transfer. Copyright 2015

ETI – What we do – ETI Strategy What is an ETI strategy and why do you need one? How far back can you claim? Recalculate your ETI to make sure you have claimed maximum benefit When to claim and How to claim Prepare your audit packs GET YOUR MONEY BACK – The most frustrating of all the processes – We don’t stop until its in your bank account. WE Ensure at all times that the necessary specialist skills are available. Manage risk and keep you informed all the way. Send hundreds of s, make countless phone calls and attend SARS meetings. Ensure there is no disruption in your business. Copyright 2015

ETI - What our clients have to do Give us permission to Act on their behalf regarding the ETI reimbursement with SARS. Commit themselves to the ETI refund process and ETI tax compliance. Give us access to the data we require. Allow access to their tax records an HR information. Keep running business as usual. We do the rest – and we do it better than anyone else Copyright 2015

ETI Assessment Have you had your ETI assessed, checked or validated? There is very little time to get your ETI claims calculated and submitted correctly. In our case study start to finish took 10 months. What do we need from you? Permission to do so in writing. The form is available on request. What do you get? A report detailing your total Calculated ETI benefit. There is no obligation to use our services, or any hidden fees. The assessments and our services will be scheduled within our existing commitments. Unfortunately we cannot service everyone because of time constraints. everyone before deadline 31 December Copyright 2015