In recent times many employees are going on early retirement and are then also taking on jobs where they are paid some form of remuneration.
These two sources of income are taxed independently of each other (i.e. one calculation by the pension administrator and the other by the employer) and only get combined on assessment.
When combined, the tax liability increases (often substantially) leaving the individual with an unplanned debt to SARS.
Many individuals find themselves in a difficult situation as they are not in a position to pay this additional tax liability and are then required to enter into a repayment program with SARS.
SARS have seen a marked increase in these scenarios and are requesting employers to take some initiative to assist employees from falling into this situation by deducting additional tax during the year.
SARS have also started engaging with pension administrators to change their systems to allow for more flexibility regarding tax calculations.