SOURCE CODE DESCRIPTIONS IRP5 code 3721

Allowance codes

in the electronic file IRP5 code 3721 is used for: Dividends not exempt i.r.o. par (jj) of the proviso to s 10(1)(k)(i) (PAYE). Any dividend in respect of a restricted equity instrument as defined in section 8C that was acquired in the circumstances contemplated in section 8C if that dividend is derived directly or indirectly from, or constitutes –
· an amount transferred or applied by a company as consideration for the acquisition or redemption of any share in that company
· an amount received or accrued in anticipation or during the winding up, liquidation, deregistration, or final termination of a company; or
· an equity instrument that is not a restricted equity instrument as defined in section 8C, that will, on vesting be subject to that section.
. Code 3771 MUST only be used for foreign service income. Applicable from 2018 YoA.

The prescribed Length of IRP5 code 3721 in the electronic file is: N15

The abbreviations used within the description of the relevant codes mean:
• PAYE: Income is subject to the deduction of Employees’ Tax and will also be taxed when the income tax assessment for the employee is processed.
• IT: Income is not subject to the deduction of Employees’ Tax but will also be taxed when the income tax assessment for the employee is processed.
• Excl: Income is not subject to the deduction of Employees’ Tax and will also not be taxed when the Income Tax assessment for the employee is processed.
• Excl/PAYE: Depending on the circumstances described in the legislation, the income is either subject to both PAYE and Income Tax, or it is excluded from both PAYE and Income Tax