Deceased Employee – responsibility of the Employer?

By
Silindile Phakathi
Tax Manager
April 17, 2023
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If an employee or co-worker passes away, it can affect other employees and the workplace.

The employer should:

• tell others at work the person has died, in a sensitive and personal way

• offer support to staff affected by the death

• contact the person’s family or next of kin to offer condolences

• let staff know how they can give their condolences

• share details of the funeral or ceremony if staff have been invited

Before sharing any details with staff, it’s best to ask the person’s family or next of kin what they’d like people at work to know about the death.

14 December 2021 – The Fourth Schedule to the Income Tax Act (the Act) places various obligations on an employer in respect of the deduction or withholding of employees’ tax and the administrative requirements related thereto.

What obligation rests on the employer?

Paragraph 13(2)(b) of the Fourth Schedule to the Act provides that an employer, who ceased to be an employer in relation to an employee, for example when an employee dies, is required to deliver an employees’ tax certificate within 14 days of the date on which employment ceased to the former employee (or to such deceased employee’s representative).

The employer must therefore deliver an employees’ tax certificate within 14 days after the employee passed away. The employer is required to provide the employees’ tax certificate to the executor acting as the representative taxpayer of the deceased employee.

The provisions of paragraph 14(5) of the Fourth Schedule that states the employees’ tax certificate shall not be delivered until the EMP501 reconciliation was submitted to SARS is not applicable to the circumstances envisaged under paragraph 13(2)(b). An employer must therefore, in the case of an employee’s death, provide the employees’ tax certificate even if the reconciliation is not yet submitted.

What obligation rests on the executor?

The executor, as the representative taxpayer, is responsible to finalise the financial and tax affairs of the deceased employee efficiently and without any unnecessary delays. The executor should therefore ensure that the necessary documentation, like the employees’ tax certificate is obtained from the deceased’s employer.