COID Registration

All the money collected from Employers in accordance with the Notice of Assessment as determined by the Department of Labour goes into one fund called the Compensation Fund.  This is the fund which is used to pay out successful injury claims which in 2020 it was valued at R70 billion. 

Every business who employs people is required to register for COID.  

There are a few government departments and mining companies who are exempt, as they have their own insurance cover. 

There are two main reasons for registering for COID. The first is for the insurance cover as a small business may not be able to afford a large unexpected medical bill and the second reason is that most government tenders require a COID registration to be tender compliant. 

A letter of Good Standing is a certificate stating that your company is registered for COID and that all your payments are up to date. It also gives the business that you are dealing with the assurance that they will not be liable for any injuries to your staff that took place on their premises. The certificate is valid for a year and expires each year on the 31 March

This is a 2 stage process, the first of which is to register with COID, thereafter a Return of Earning is required to be submitted to the Department of Labour for them to determine the amount due for the insurance cover. 

The return of earnings for a COID application it the total projected staff salary bill for the coming year.  It is required to be submitted to the Department of Labour each year before the 31 March. It includes both full time and part time salaries, but it excludes the owners’ salaries and the value is usually a large sum of money relative to the size of any business.  COID dues are a small percentage of the total wage bill for the insurance premium to cover the risk of injury. The percentage varies between different business sectors with the riskier business such as construction paying a higher percentage. Once you have submitted your return of earning to the Department of Labour, they will assess it and send you a Notice of assessment which is essentially an invoice of the amount due to them. Once the invoice has been settled,  the Department will issue the Letter of Good Standing. 

The Company must register within 7 days after the first employee started working for the company. 

The return of earnings are due on the 31 March each year. 

A letter of Good standing is valid for 1 year and always expires on the 31 March each year regardless on which date it was issued

The letter of Good standing is valid from 1 April until the 31 March the following year. Therefore, if you apply for the letter of Good standing in January it will only be valid for 3 months.