The UIF is conducting post-verification audits on COVID-19 TERS payments to ensure that funds went to the right employees and were used correctly. These audits are handled by appointed firms, over a 12-month period starting on 11 September 2024.
Why the Audits Are Happening
Simply put, UIF wants to ensure:
Employers only claimed for employees genuinely employed before the lockdown.
The correct amounts were paid to employees.
Fraud and misuse of funds are detected and addressed.
Some employers misused TERS funds, leading to fraud investigations, prosecutions, and UIF tightening its compliance measures.
What Employers Need to Do
If you’re selected for an audit, be prepared to:
Provide all necessary documents (payslips, UIF declarations, proof of payments, etc.).
Grant auditors access to relevant records and premises.
Verify any audit firm contacting you before sharing sensitive information.
How to Verify an Auditing Firm
Before you hand over any information, make sure the auditing firm is legitimate:
Check UIF’s official website: www.labour.gov.za
Contact UIF directly via 0800 030 007 or TERScompliance@labour.gov.za
Ask the auditing firm for their UIF appointment letter and cross-check with UIF.
Important: If the firm isn’t on UIF’s approved list, don’t engage with them!
How to Handle a UIF TERS Audit Effectively
Receiving an audit notice from the Department of Labour regarding UIF Temporary Employee/Employer Relief Scheme (TERS) payments can be daunting. However, with the right approach, you can handle the process efficiently and minimise stress. This guide outlines the key steps to take when you receive a UIF TERS audit and the best practices for handling it.
Step 1: Respond Promptly
Ignoring the audit letter is a critical mistake. Employers typically have a short timeframe (often three to five days) to submit the required documents, which may not be realistic. Immediately respond to the notice and request a 30-day extension to allow sufficient time to compile the necessary documents. Send this request via email to the official handling your case.
Step 2: Understand the Required Documents
The UIF audit requires a comprehensive set of documents, including:
Bank statements showing TERS payments received and payments made to employees.
Payroll reports for the relevant period (January 2020 to the last month of TERS application).
Employee contracts or appointment letters.
Copies of passports for foreign nationals (if applicable).
Tax clearance certificate for the period of application.
Reconciliation of UIF TERS funds received versus funds paid to employees.
Bank confirmation letter submitted with the TERS application.
Payslips and UIF declarations (EMP201 and EMP501 forms).
Proof of temporary business closure during lockdown (if applicable).
Attendance records or clocking reports.
Proof of payments made to employees.
Proof of any UIF refunds (if applicable).
Salary increase or termination letters (if applicable).
Current tax clearance certificate.
UIF employer compliance documents (EMP201 for the current period).
Step 3: Organise Your Documents
To ensure a smooth audit process, follow these best practices:
Create a dedicated folder for all UIF TERS audit-related documents.
Use a checklist to track the status of each document (Not Started, In Progress, Completed).
Name documents according to the checklist for easy retrieval.
Convert all files to PDF format before submission.
Keep backup copies of all submitted documents.
Step 4: Present the Documents Clearly
A well-organised submission can expedite the audit process. Consider including:
A cover letter summarising the documents included and any challenges in retrieving records.
A reconciliation spreadsheet showing a clear breakdown of received funds versus payments made.
Explanations for missing or unavailable documents.
Step 5: Follow Up and Stay Proactive
After submitting the required documents:
Confirm receipt of your submission via email.
Ask for a timeline on when you can expect feedback.
Be prepared to provide additional information if requested.
If discrepancies arise, address them promptly and professionally in writing.
By staying organised and proactive, you can navigate the UIF TERS audit process with minimal stress and ensure compliance with UIF regulations.
