Reference to the Act
Remuneration definition in Paragraph 1 of the 4th Schedule
Paragraph (cA) of the definition of gross income in Section 1
Payments in respect of a restraint of trade (i.e. sterilisation of a person’s income
earning capacity) are included in the definition of remuneration.
Where a payment in respect of a restraint of trade was received or accrued, it will be taxable in full if it was received by or accrued to a natural person, a labour broker not in possession of an exemption certificate or a personal service provider.
Employees’ Tax from restraint of trade payments must be calculated in the same
manner as tax on a bonus.
Restraint of trade payments must be reflected under code 3613 on the certificate