Pastel Evolution Payroll & HR Tax Year End Guide (2012)

Pastel Evolution Payroll & HR Tax Year End Guide (2012)
Are you prepared for the Tax Year End
There’s so much to do – organise your financial information for your Accountant, submit tax returns, print and submit your
PAYE payment summaries and more - it can all become a little overwhelming!
We have prepared this step-by-step guide to ensure that your Year End procedure on Pastel Evolution Payroll is as
smooth and trouble free as possible. This guide is designed to assist you in the correct processing of your Tax Year End to
prevent unnecessary pressure and frustration, as another means of continuing to support the growth of your business and
development of our ongoing partnership with you.
The Year End procedures for Pastel Evolution Payroll & HR outline the printing of relevant reports according to your
company’s and legislative requirements as well as backup and restore procedures.
This Pastel Evolution Payroll & HR Year End guide explains:
Creating the IRP5 / IT3(a) export file for e@syFile.
Printing hard copy reports for your own records.
Making backups.
Setting up your company for the new tax year.
Please ensure that your returns are submitted to the Receiver of Revenue within 60 days after the end of the tax year
unless otherwise specified by the Minister of Finance.
Telephonic & Email Support
Should you require further assistance you can contact our Support Team on +27 11 304 4360 or e-mail us at
support@evolutionpayroll.co.za
Book a Consultant
Book a consultant now and ensure you submit accurately and on-time.
Should you require an on-site Consultant, please contact our Consulting Team on (011) 304 4340 or e-mail us at
consulting@evolutionpayroll.co.za. Alternatively, contact your Pastel Payroll Certified Installer.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
PASTEL EVOLUTION PAYROLL & HR TAX YEAR END CHECKLIST
Before commencing with the Year End procedures, you are required to complete your processing in the final period.
Taking into consideration that the last period is when final changes can be made, you need to perform a tax
reconciliation to ensure that the total tax in Pastel Evolution Payroll corresponds to what was paid over during the year.
Once you are confident that the tax is calculated correctly, you are required to print all Monthly, Weekly or Fortnightly
Reports.
When performing the Period Close, verify that you have made backups and that the period you are closing is the final
period in the tax year. This can be verified in Maintenance | Common | Company Details on the Payroll Periods tab,
allowing you to establish which periods have not been closed.
Adequate backups of the company data must be kept, should any changes occur at a later stage. This step is
essential and must be followed for every company you will perform a Year End for.
Please execute each step thoroughly and tick each step upon completion
1. Making a backup after the last periods are processed
2. Performing the final Period Closes
3. Making a backup for Tax Certificate purposes
4. Performing the Standard Year End
5. Setting up the Payroll Periods for the new tax year
6. Restoring the backup made in step 1 for IRP5 purposes
7. Locating the Year End company
8. Running the IRP5 log file and fixing errors
9. Performing the final Period Closes
10. Creating the IRP5 / IT3(a) export files and printing tax certificates
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
1. Making a backup
a. Open Pastel Evolution Payroll & HR and log into your company. Ensure that the last periods are
processed.
b. Select Administration | System Tools | Evolution Backup.
c. The following screen is displayed:
The Backup this Common Database option is selected by default, but it is not necessary to make a
backup at this stage. Deselect the option and click OK.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
d. Please ensure that the following options have been selected:
Database – complete: This will back up the entire Company Database (Recommended).
Truncate Log: This will compress the log file to save space on your hard drive.
Overwrite backup: This will ensure that no partial backups with the same name exist.
Destination: This must always be on a hard drive. At a later stage you may use external CD writing
software to write the backup to CD. Please ensure that you give each backup a unique name. The
name should contain the period date you are closing, which will prevent the backup from
overwriting any other backups as well as for easy identification of the backup. Backup files MUST
end with the extension .bak.
e. Click OK to start the backup process.
Note: This process may take several minutes to complete. Please wait until the process has
completed.
f. A message is displayed to inform you that the backup process has been completed successfully.
Click OK.
Note: Steps a – f must be followed for each company the year end process is going to be performed
on.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
2. Performing the final period closes
a. Select Transactions | Payroll | Period Close.
b. If this is the correct period to be closed, click OK.
Note: This process may take several minutes. Please wait while the process completes.
Note: Should your company make use of different pay frequencies (Monthly Salary, Monthly
Wages, Fortnightly Wages or Weekly Wages); this process has to be repeated for each of the pay
frequencies.
c. The following message is displayed on your screen once you have successfully closed the final
period in the tax year:
Click OK.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
d. Once the Period Close has completed successfully the following message will be displayed: ‘Payroll
Period Close Completed. Would you like to view the Log File now’
e. Click Yes. Ensure that the message log viewer for the period close ends with the line “Period Close
Completed Successfully”. Should this line not be displayed in the message log viewer, you will have
to restore the backup that you have made before closing the period and do the period close again.
f. Note: Should it be necessary to perform a Period Close for more than one pay frequency, you are
required to do a Pay Period Selection to change the pay frequency.
Perform the final period closes as described above until all the pay periods are closed for all of the
pay frequencies that your company uses.
3. Making a backup for tax certificate purposes
a. Ensure that the final period closes are completed.
b. Select Administration | System Tools | Evolution Backup.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
c. The following screen displays:
The Backup this Common Database option is selected by default, but it is not necessary to make a
backup at this stage. Deselect the option and click OK.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
d. Please ensure that the following options have been selected:
Database – complete: This will back up the entire Company Database (Recommended).
Truncate Log: This will compress the log file to save space on your hard drive.
Overwrite backup: This will ensure that no partial backups with the same name exist.
Destination: This must always be on a hard drive. At a later stage you may use external CD writing
software to write the backup to CD. Please ensure that you give each backup a unique name. The
name should contain the words “Year End 2012”, which will prevent the backup from overwriting
any other backups as well as for easy identification of the backup.
e. Click OK to start the backup process.
Note: This process may take several minutes to complete.
completed.
Please wait until the process is
f. A message is displayed to inform you that the backup process has been completed successfully.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
4. Performing the standard year end
a. Select Transactions | Payroll | Standard Year End.
b. You have the following options:
Delete Discharged Employees - This will delete any employees that have been discharged
throughout the 2011/2012 tax year.
Delete Inactive Employees - This will delete all employees that you have made inactive throughout
the 2011/2012 tax year.
Reset Employees Tax Directives – This will reset the tax method of all employees on Tax Directives
in order to use standard tax scales.
Update Directors Remuneration - If an employee is setup as a Director, the remuneration for the
current tax year will be changed to Last Year’s Remuneration. This is what the Directors’ Tax will
be based on in the new tax year.
Reset Director’s Additional Remuneration - This will reset the amount of Director’s Additional
Remuneration to zero.
Note: If your company is required to submit Skills and Equity Reports, DO NOT delete inactive and
discharged employees.
If you do not want to select any of the above options, for example you do not want to delete your
inactive employees, deselect the applicable option. When the Standard Year End is performed,
Pastel Evolution Payroll & HR will not perform the actions for which the options are not selected.
c. Once you have made the appropriate selection, click OK to start the Year End process.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
d. Ensure that all Year End reports have been printed and that a backup has been made.
Click Yes to continue as illustrated below.
e. Once the Year End process has completed, a message will be displayed on your screen: ‘The
standard year end has been completed. Would you like to view the log file now’ Click No, as it is
not necessary to view the log file at this stage.
Note: This procedure may take a long time to complete. Even if the program reports to be “Not
Responding”, it is still executing the process in the background and under no circumstances should
the process be stopped or the computer be switched off or restarted. Should an interruption in this
process occur, you will have to restore a backup and start the process again.
f. The employee and company information will be available in the company after the Standard Year
End has been completed. You are required to set up the new Payroll Periods for the company in
order to process the new Tax Year.
5. Setting up the payroll periods for the new tax year
a. After the Standard Year End has been completed, your company periods will be reset and the old
periods will be transferred to the History files. You are now required to set up your Payroll Periods
for the new tax year.
Select Maintenance | Common | Company Details and then select the Payroll Periods tab.
b. Select the tax year start date and end date. This will always be from 1 March to 28/29 February
(depending on whether it is a leap year) as illustrated below.
c. After the tax year has been set, you are required to set up the new Payroll Periods. This procedure
applies to all pay frequencies.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
d. To set up the new periods, select the end date of the first period that the employees of that specific
pay frequency will be paid, i.e. 2012/03/31 for monthly employees.
e. Now that the date has been selected, click on Generate. Repeat steps d and e for all of the pay
frequencies that your company uses.
f. Once you have generated the Pay Periods for all required Pay Types, Click OK. You can refer to
step h. for an example of what the Payroll Periods tab should look like before saving your period
settings (Note: your dates may differ).
Note: Once the payroll period settings have been set up, they cannot be changed again. Please
ensure that the period settings are specified correctly before clicking OK to save them.
g. A message will be displayed on your screen confirming you that the tax year setting is final. If you
are sure that your periods are setup correctly, Click OK to save.
h. You are now ready to process your first period in the 2012/2013 tax year company.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
6. Restoring the backup made in Step 1 for IRP5 purposes
a. Open Pastel Evolution and HR and click on the Restore button on the login screen.
b. Select the machine name of your server in the SQL Server Name field and click OK.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
c. In the Restore as database field, change the name of the company. It must be easily identifiable as
the copy of your original company which you are going to use to print tax certificates, e.g.
WAGES12 Year End 2012.
In the Backup file field, browse for the file that you created in step 1 above.
d. Click OK.
e. A message is displayed to inform you that the restore process has been completed successfully.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
7. Locating the year end company
a. Once you have restored the year end company, you are required to locate it in order to log into it
once you are ready to print your tax certificates.
b. Click the Locate button.
c. On the Locate Pastel Evolution Payroll Database screen select the following options:
This should be the
machine name of
the server
d. Select the machine name of your server in the SQL Server Name field.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
e. In the Database Name field select the newly created year end company from the drop-down list as
illustrated above.
f. Click Next.
g. You can leave the Use Common database on the same server option selected. If you are
prompted to create a new Common Database, deselect the Create new Common database on
same server option
h. Note: You only need to follow this step if your screen prompted you to create a new Common
Database and you deselected the option in step g.
In the Database Name field select the same common database that is used on the original
company.
i. Click Finish.
j. The Login screen is now displayed, listing the year end company. Log into the company. (Year
End Company i.e. WAGES12 Year End in our case)
8. Run the IRP5 log file and fix the errors
a. Once you have located and opened the year end company, you need to perform the validation run
and fix the errors if there are any. Select Reports | Payroll | Statutory Reports | IRP5 / IT3(a) Tax
Certificates.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
b. Click on the Validation Run button.
c. When there are errors on the system, the following error message will be displayed.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
d. Click OK. The Message Log Viewer window will be displayed. Missing or invalid information and
errors are displayed.
Select the ‘+’ sign next to the last Group Time item in the list. Always look at the latest Group Time
item on the list. That will ensure that the most recent errors are displayed. All the errors must be
corrected before you will be able to continue to view the tax certificates. Information messages are
for information purposes only.
e. Refer to the list of errors at the end of this guide if you do not know how to fix specific errors. You
can also contact one of our professional services agents at +27 11 304 4360 for assistance.
Note: Steps a – d must be followed until all errors have been corrected.
9. Perform the final period closes
a. Once all errors have been fixed, you need to perform the final period closes.
b. Select Transactions | Payroll | Period Close.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
c. If this is the correct period to be closed, click OK.
Note: This process may take several minutes. Please wait while the process completes.
Note: Should your company make use of different pay frequencies (Monthly Salary, Monthly
Wages, Fortnightly Wages or Weekly Wages); this process has to be repeated for each of the pay
frequencies.
d. The following message is displayed on your screen once you have successfully closed the final
period in the tax year:
Click OK.
e. Once the Period Close has completed successfully the following message will be displayed: ‘Payroll
Period Close Completed. Would you like to view the Log File now’
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
f. Click Yes. Ensure that the message log viewer for the period close ends with the line “Period Close
Completed Successfully”. Should this line not be displayed in the message log viewer, you will have
to restore the backup that you have made before closing the period and do the period close again.
g. Note: Should it be necessary to perform a Period Close for more than one pay frequency, you are
required to do a Pay Period Selection to change the pay frequency.
Perform the final period closes as described above until all the pay periods are closed for all of the
pay frequencies that your company uses.
10. Creating the IRP5/IT3(a) export files and printing tax certificates
a. To create your IRP5/IT3(a) electronic submissions for SARS, you need to log into the year end
company. (The company you located in step 7e.)
b. Select Reports | Payroll | Statutory Reports | IRP5/IT3(a) Tax Certificates to create the export file or
to print your employees’ tax certificates.
c. Select which Pay Types should be included when the export file is generated.
d. Pay Periods & Employees: If certain employees should be excluded, make use of the “Employees”
tab to specify which employees will be included in the run. All employees will, by default, be
included unless otherwise specified.
e. Run Options: In this section, you are required to select the type of export file. Create a test export
file and submit to e@syFile first, before creating a Live export file.
Note: If you are only able to select the Test option, it means that there are still Payroll Periods that
have not been closed. Please refer back to step 9 above and ensure that all your Payroll Periods
are closed.
f. Print Options: When creating the export files, select the Create Export File option. You may
deselect the Print Tax Certificates option, unless you would like to print and check the tax
certificates.
Note: Tax Certificates should not be printed and given to employees from Pastel Evolution Payroll.
Instead, the tax certificates generated by SARS e@syFile should be used as official records and be
handed to employees. The process of generating tax certificates through SARS e@syFile is
explained in the SARS e@syFile Submission User Guide.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
g. Export Options: This is where you set the generation number. In the Save To Drive field, select a
destination to where the export file is to be saved. All the export files are created with the same
name; therefore if an export file exists in a folder that contains the same file name, the original file
will be deleted and replaced with the new one.
Once the correct options have been selected, click the Preview button.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
h. Once all the errors have been corrected, the Payroll IRP5/IT3(a) Export Errors message will not be
displayed. The Message Log Viewer is displayed immediately. Click Close.
i. A second Message Log Viewer will be displayed. This will contain the Payroll IRP5/IT3(a)
Certificates Export Totals.
j. Once the export totals have been verified, close the Message Log Viewer window. The tax
certificates will now be displayed on the screen.
k. Once the export file has been created, it can be imported into e@syFile where you can do your
EMP501 reconciliation, submit to SARS and print employee tax certificates.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
List of errors you might encounter on the IRP5/IT3(a) Certificates Validation Run
Invalid Company PAYE or Income Tax Reference Number. Go to Maintenance | Common | Company Details on the
Payroll Details tab to rectify.
The Company PAYE Reference Number needs to start with a 7 where any tax values exist. Go to Maintenance |
Common | Company Details on the Payroll Details tab to rectify.
Employer SDL Reference Number is required where SDL Transactions exist. Go to Maintenance | Common |
Company Details on the Payroll Details tab to enter the number.
Blank Employer IRP5 UIF Reference Number where UIF Transactions exist. Go to Maintenance | Common | Company
Details on the Payroll Details tab to enter the number.
Blank Employer Contact Person name. Go to Maintenance | Common | Company Details on the Payroll Details tab
under SARS Contact Details to enter the name.
Blank Employer Telephone Number. Go to Maintenance | Common | Company Details on the Payroll Details tab under
SARS Contact Details to enter the number.
Employer Telephone Number may not be less than 9 numbers. Go to Maintenance | Common | Company Details on
the Payroll Details tab under SARS Contact Details to rectify.
Employee Home Telephone Number may not be longer than 11 characters long. Go to Maintenance | Payroll |
Employees on the relevant employee’s Contact Details node to rectify.
Employee Business Telephone Number must be numeric. Go to Maintenance | Payroll | Employees on the relevant
employee’s Contact Details node to rectify.
Blank Employer Trade Classification. Enter the Trade Classification Group and Trade Classification in Maintenance |
Common | Company Details on the Payroll Details tab.
Company Physical Street Address is required. Go to Maintenance | Common | Company Details on the Company tab
to enter the address.
Company Physical Address Suburb or City is required. Go to Maintenance | Common | Company Details on the
Company tab to enter the suburb or city.
Company Physical Address Postal Code is required.
Company tab to enter the postal code.
Go to Maintenance | Common | Company Details on the
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
Nature of Person requires an Employee Business Telephone Number. Go to Maintenance | Payroll | Employees on the
relevant employee’s Contact Details node under the Address Details tab to enter the number.
Employee Mobile Number must be 10 characters long. Go to Maintenance | Payroll | Employees on the relevant
employee’s Contact Details node to rectify.
Nature of Person requires an Employee Business Street Name. Go to Maintenance | Payroll | Employees on the
relevant employee’s Contact Details node under the Address Details tab to enter the street name.
Nature of Person requires an Employee Business Suburb or City Name. Go to Maintenance | Payroll | Employees on
the relevant employee’s Contact Details node under the Address Details tab to enter the suburb or city.
Nature of Person requires an Employee Business Postal Code. Go to Maintenance | Payroll | Employees on the
relevant employee’s Contact Details node under the Address Details tab to enter the postal code.
Employee Physical Address Street Name is required. Go to Maintenance | Payroll | Employees on the relevant
employee’s Contact Details node under the Address Details tab to enter the street name.
Either Employee Physical Suburb or City Name must be completed. Go to Maintenance | Payroll | Employees on the
relevant employee’s Contact Details node under the Address Details tab to enter either the suburb or the city.
Employee Physical Address Postal Code is required. Go to Maintenance | Payroll | Employees on the relevant
employee’s Contact Details node under the Address Details tab to enter the postal code.
Employee Postal Address is required. Go to Maintenance | Payroll | Employees on the relevant employee’s Contact
Details node under the Address Details tab to enter the postal address.
Employee Postal Code is required. Go to Maintenance | Payroll | Employees on the relevant employee’s Contact
Details node under the Address Details tab to enter the postal code.
Employee Banking Details - Account Holder Name is required. Go to Maintenance | Payroll | Employees on the
relevant employee’s Banking Details tab to enter the account holder name.
The employee has made retirement annuity contributions. However no retirement annuity information has been
entered in employee maintenance. Go to Maintenance | Payroll | Employees on the relevant employee’s Pay Details
tab to enter the information.
The employee has made pension/provident fund contributions. However no pension/provident fund has been selected
in employee maintenance, this is required to calculate the RFI. Go to Maintenance | Payroll | Employees on the relevant
employee’s Pay Details tab to select the correct fund.
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Pastel Evolution Payroll & HR Tax Year End Guide (2012)
The Employee Bank Branch Number needs to be 6 numeric characters in length. Go to Maintenance | Payroll |
Employees on the relevant employee’s Banking Details tab to rectify.
Employee has an employee value on transaction RA Company. Employee value must be 0 for transactions with SARS
Code 4475. Go to Maintenance | Payroll | Employees to the relevant employee’s Retirement Annuity tab and enter the
information, transaction, contribution and correct YTD figure for the employee’s Retirement Annuity contribution.
Employee does not have a transaction with SARS Code 3801. A transaction with SARS Code 3801 must exist if
values exist for SARS Codes 4475, 4476 or employer values on 4006 or 4007. When the company contributes
towards an employee’s Retirement Annuity, a Fringe Benefit transaction with code 3801 must be processed with a
value equal to the company contribution.
Important Note:
Kindly click on the links below for further information:
SARS e@syFile Submission User Guide:
http://www.pastelpayroll.co.za/Downloads/yearend/2012/62504e@syFilemanual25Nov2010v5.pdf
SARS EMP201/EMP501 Reconciliation Assistant User Guide:
http://www.pastelpayroll.co.za/Downloads/yearend/2012/0EasyFilereconassist10Dec2010.pdf
SARS ITA88 Information and Guides:
http://www.pastelpayroll.co.za/Downloads/yearend/2012/63888AgentAppointmentsusinge@syFileV5.pdf
http://www.pastelpayroll.co.za/Downloads/yearend/2012/62499AgentAppointmentsITA88ProcessGuidev0.221September
2010.pdf
If you require additional assistance, simply follow the steps below:
Step 1 – Visit Website:
Visit www.pastelpayroll.co.za for our year end support tools to assist you during this busy period.
Step 2 - E-mail us:
Due to the high call volumes we experience during the year end period, you can e-mail us at
support@evolutionpayroll.co.za. We will return your e-mail enquiry within 24 hours. Please include your company name,
name and surname as well as contact details on all e-mails to ensure a prompt response.
Step 3 – Contact us:
Contact us at +27 11 304 4360 during the following extended operating hours:
Mondays to Thursdays: 07:00 to 18:00
Fridays: 07:00 to 17:00
Saturdays: 09:00 to 13:00
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