SARS has published version 24.0.0 of the PAYE Business Requirements Specification (BRS) for the 2025/2026 tax year. This specification applies to all employers when submitting tax certificates and reconciliations. Below is a summary of the key changes:
1. New Source Code for Antedated Salary/Pension
A new source code, 3623 (or 3673 for foreign services income), has been introduced to report antedated salary/pension amounts relating to previous tax year(s).
Employers must obtain a tax directive to determine the correct amount of employees’ tax to deduct.
The following directive codes have been updated accordingly:
- 3230: Directive Number
- 3232: Directive Income Source Code
Clarification on code 3907:
Previously, code 3907 was used to report antedated salary/pension amounts relating to previous tax year(s). This code has now been amended to clarify that it must only be used for amounts relating to years of assessment up to 2025 (i.e. the 2024/2025 tax year).
From the 2025/2026 tax year onwards, any antedated salary/pension amounts relating to previous tax year(s) must be reported under the new code 3623.
Please note that any antedated salaries/pensions relating to the current tax year must continue to be reported and taxed under source code 3601.
2. New Codes for Section 11(nA) and 11(nB) Repayments
Three new source codes have been introduced to improve the reporting of repayments under sections 11(nA) and 11(nB) of the Income Tax Act:
- Code 4042
Reflects the amount of tax deduction allowed in the payroll system where an s11(nA) refund has been processed. SARS will use this value during tax validations, including during EMP501 submissions. - Code 4588
Reports the total amount repaid to the employee during the tax year in relation to an s11(nA) recoupment.
This replaces the previous requirement for the employee to submit a repayment confirmation letter when claiming a deduction in their personal tax return.
Important: If the repayment occurs outside of the payroll system (i.e. not processed as a payroll deduction), the amount must still be reflected on the employee’s tax certificate as an information code to enable the employee to claim any further allowable tax deduction upon assessment. - Code 4589
Reports the total amount repaid by the employee during the tax year in respect of an s11(nB) recoupment (typically relating to restraint of trade payments).
As with code 4588, if the repayment is not processed in payroll, it must be reported as an information code to ensure correct tax calculation upon assessment.
For further details, you can access the full SARS PAYE BRS Version 24.0.0 here:
The Product Compliance Team is currently in the process of analysing these changes and implementing the necessary updates in the system to ensure compliance with the new requirements.