SOURCE CODE DESCRIPTIONS IRP5 code 3771

Allowance codes

in the electronic file IRP5 code 3771 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 3771 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