[Section 5 heading substituted by section 57(1)(a) of the Taxation Laws Amendment Act 42 of 2024, Notice No. 5736, GG51826, dated 24 December 2024 - comes into operation on 1 March 2025 and applies in respect of years of assessment commencing on or after that date (section 57(2))]
| (1) | Where an employer is deemed to have displaced an employee as contemplated in subsection (2), that employer— |
| (a) | must pay a penalty to the South African Revenue Service in an amount of R30 000 in respect of the employee that is displaced; and |
| (b) | may be disqualified from receiving the employment tax incentive by the Minister of Finance by notice in the Gazette after taking into account- |
| (i) | the number of employees that have been displaced by the employer; and |
| (ii) | the effect that the disqualification may directly or indirectly have on the employees of the employer. |
| (2) | For the purposes of subsection (1), an employer is deemed to have displaced an employee if— |
| (a) | the resolution of a dispute, whether by agreement, order of court or otherwise, reveals that the dismissal of that employee constitutes an automatically unfair dismissal in terms of section 187(1)(f) of the Labour Relations Act; and |
[Section 5(2)(a) amended by section 114(a) of Act No. 43 of 2014]
| (b) | the employer replaces that dismissed employee with an employee in respect of which the employer is eligible to receive the employment tax incentive. |
| (3) | If an employer receives the employment tax incentive in respect of an amount that must be disregarded in terms of the proviso to the definition of ‘monthly remuneration’ in section 1(1), that employer must pay a penalty to the South African Revenue Service in an amount equal to 100 per cent of the employment tax incentive received in respect of that employee in respect of each month that the employer received the employment tax incentive relating to the amount that should have been so disregarded |
[Section 5(3) inserted by section 57(1)(b) of the Taxation Laws Amendment Act 42 of 2024, Notice No. 5736, GG51826, dated 24 December 2024 - comes into operation on 1 March 2025 and applies in respect of years of assessment commencing on or after that date (section 57(2))]
