mra.mw PAYE Pay As You Earn : Malawi Revenue Authority

Organization : Malawi Revenue Authority
Type of Facility : PAYE Pay As You Earn
Country: Malawi

Website : http://www.mra.mw/

MRA PAYE Pay As You Earn

Pay As You Earn (PAYE) is a method of collecting Income Tax in advance from employees on their earnings. Deduction is done by the employer when the payments are made.

Related : Malawi Revenue Authority Register For VAT Value Added Tax : www.statusin.org/8969.html

It could be weekly, fortnightly or monthly hence the name Pay As You Earn.

Who is eligible to operate PAYE?:
Any employer who pays an employee in excess of K20, 000.00 per month or K240, 000.00 per year is liable to deduct PAYE and remit to MRA.

PAYE Rates

With effect from 1st July 2013, the applicable rates for PAYE on a monthly basis are as follows:
** The first K20, 000. 00 at 0%
** The next K5, 000. 00 at 15%

The excess of K25, 000. 00 at 30%.

When should an employer register for operation of PAYE?:
An employer who employs people whose earnings exceed K20, 000 per month or K240, 000 in a year is required to register for operation of PAYE.

Upon registration, MRA will supply the employer with registration forms (Form P1) where all the details concerning the employer and the appropriate number of employees who are eligible for PAYE are filled. An employer is required to register for PAYE within a period of 21 days after becoming an employer.

In case of changes, for example, an employee has resigned, such employer is required to communicate to MRA within 14 days upon making those changes.

What other details does Form P1 contain?:
** The name of the organisation
** The name of the officer (employer’s representative) or public officer who will be handling taxation issues on behalf of the organisation or company.
** Name of other places where the employer has offices or branches.
** Number of employees who earn more than K20, 000 per month or K240, 000 per annum.
** A declaration by the employers’ representative that the information given is correct.
** Physical and postal addresses and contact numbers of the taxpayer.

When and where should PAYE be paid?:
The deduction of PAYE from an employee’s earnings becomes due at the time when earnings are paid to the employee.

The amount of tax deducted should be remitted to MRA not later than the 14th day from the end of the month during which the tax was deducted.

MRA will give the employer Form P12. This is a monthly payment form that should accompany any PAYE payments to MRA every month.

Usually, a booklet of 12 copies of Form P12 is supplied to the employer to cover a period of one fiscal year.

Advantages of PAYE to taxpayers:
** It is convenient to pay while the money is available.
** It is easy and cost effective to pay.
** Affords the taxpayer to pay by installments other than having the burden to pay a lump sum.

What would happen to an employer who fails to remit or register their employees who earn more than K20, 000 per month or K240, 000 in a year?
Any employer who fails to register their employees who are eligible for PAYE or remit PAYE deducted should pay all taxes due from the time he/she would have registered their employees plus an additional sum of 20% penalty of the taxes defaulted for the first month and a further additional sum of 5% per month or part thereof for the period during which the amount of the tax remains unpaid.

Notice:
The Law relating to Income Tax is Taxation Act. This information is not intended to be a legal interpretation of the Act (regulations made there under) nor does it override any provision thereof.

Additional Simplified Procedure

You can pay your Pay As You Earn (PAYE) online in Malawi through the Malawi Revenue Authority’s (MRA) ePayments system.

To do this, you will need to:
1. Go to the MRA website: https://www.mra.mw/
2. Click on the “ePayments” tab.
3. Select “PAYE” from the list of services.
4. Enter your taxpayer identification number (TIN) and password.
5. Click on the “Pay” button.
6. You will then be taken to a page where you can enter your payment details.
7. Enter the amount you want to pay and the bank account you want to pay from.
8. Click on the “Pay” button.

Your payment will be processed immediately and you will receive a confirmation receipt.

Here are some additional things to keep in mind when paying your PAYE online:
** You can only pay your PAYE online if you have a TIN and a password.
** You can pay your PAYE online using any bank account that is registered with the MRA.
** You can also pay your PAYE online using a credit or debit card.

If you have any problems paying your PAYE online, you can contact the MRA’s customer service.

Here are the PAYE payment deadlines in Malawi:
** For employees, the PAYE payment deadline is the 15th of each month.
** For employers, the PAYE payment deadline is the 20th of each month.

Note:
If you miss the PAYE payment deadline, you will be charged a penalty. The penalty is 5% of the amount due for each day that the payment is late.