LSB2605
ASSIGNMENT 2 (SEMESTER 2)
DUE DATE: 18 September 2023
QUESTION 1
ABC Electronics is a sole proprietorship that sells electronic gadgets. The business’s total annual
turnover is R1,600,000, of which 25% is the cost price of the equipment it stocks. The owner
recently hired two employees and wants to ensure that he complies with labour laws.
1.1 With which two bodies must ABC Electronics register as an employer? (2)
ANSWER:
ABC Electronics must register as an employer with the following two bodies:
• The South African Revenue Service (SARS): This registration is necessary for tax purposes and
ensures that ABC Electronics complies with its tax obligations.
• The Department of Labour: This registration is essential for compliance with labor laws and
regulations, including matters related to employment contracts, working conditions, and
labor standards.
1.2 Is ABC Electronics required to withhold taxes on behalf of its employees? Explain ABC’s
duties fully. (4)
ANSWER:
Yes, ABC Electronics is required to withhold taxes on behalf of its employees. The duties related
Terms of Utilisation:
to tax withholding include:
1. Educational and Reference: You may use this document for educational, reference, and comparison purposes.
• Pay-As-You-Earn
2. (PAYE):
No Duplication or Misrepresentation: You ABC Electronics
are not allowed must deduct
to duplicate or misrepresent and
this document's withhold
content PAYE from each
as your own work.
employee's
3. salary
Accept Consequences: If youevery month.
misuse or plagiarize The withheld
this document, amount
you accept responsibility is then
for any resulting remitted to SARS on behalf of
consequences.
the
Your use employees.
of this The
document signifies your employer
agreement to these terms.is responsible
Failure to comply may lead for
to legalcalculating themeasures.
action or other appropriate correct amount of PAYE
based on the employees' earnings and the applicable tax tables.
UIF (Unemployment Insurance Fund): ABC Electronics is also required to deduct UIF
ASSIGNMENT 2 (SEMESTER 2)
DUE DATE: 18 September 2023
QUESTION 1
ABC Electronics is a sole proprietorship that sells electronic gadgets. The business’s total annual
turnover is R1,600,000, of which 25% is the cost price of the equipment it stocks. The owner
recently hired two employees and wants to ensure that he complies with labour laws.
1.1 With which two bodies must ABC Electronics register as an employer? (2)
ANSWER:
ABC Electronics must register as an employer with the following two bodies:
• The South African Revenue Service (SARS): This registration is necessary for tax purposes and
ensures that ABC Electronics complies with its tax obligations.
• The Department of Labour: This registration is essential for compliance with labor laws and
regulations, including matters related to employment contracts, working conditions, and
labor standards.
1.2 Is ABC Electronics required to withhold taxes on behalf of its employees? Explain ABC’s
duties fully. (4)
ANSWER:
Yes, ABC Electronics is required to withhold taxes on behalf of its employees. The duties related
Terms of Utilisation:
to tax withholding include:
1. Educational and Reference: You may use this document for educational, reference, and comparison purposes.
• Pay-As-You-Earn
2. (PAYE):
No Duplication or Misrepresentation: You ABC Electronics
are not allowed must deduct
to duplicate or misrepresent and
this document's withhold
content PAYE from each
as your own work.
employee's
3. salary
Accept Consequences: If youevery month.
misuse or plagiarize The withheld
this document, amount
you accept responsibility is then
for any resulting remitted to SARS on behalf of
consequences.
the
Your use employees.
of this The
document signifies your employer
agreement to these terms.is responsible
Failure to comply may lead for
to legalcalculating themeasures.
action or other appropriate correct amount of PAYE
based on the employees' earnings and the applicable tax tables.
UIF (Unemployment Insurance Fund): ABC Electronics is also required to deduct UIF
