COIDA Assessments and Tariffs: How the Fund Calculates What You Pay
The COIDA assessment is the price tag on your injury-cover immunity, and it confuses employers because it arrives as a single annual invoice with very little explanation. The calculation underneath is simple — earnings, divided by 100, times a tariff — but the tariff is where everything happens. This guide unpacks the formula, the class system, the earnings cap, and how to audit your own invoice.
- ✔Assessment = earnings ÷ 100 × your industry class tariff.
- ✔The tariff follows your real dominant business activity — not your company name.
- ✔A per-employee earnings cap stops high salaries inflating the assessment.
- ✔Misclassification is the number one cause of wrong assessments — check your class.
- ✔The assessment invoice follows your ROE; query errors before paying, not after.
The COIDA assessment formula in one line
Assessment = total assessable earnings ÷ 100 × tariff. The earnings come from your Return of Earnings (actual earnings for 1 March – end February, with a per-employee cap), and the tariff comes from the industry class the Fund assigned at registration. An office business declaring R900,000 of earnings at a tariff of 0.20 pays R1,800; the same earnings in a higher class at 1.20 pays R10,800. The class is the multiplier on everything.
| Declared earnings | Tariff 0.20 | Tariff 0.60 | Tariff 1.20 |
|---|---|---|---|
| R500,000 | R1,000 | R3,000 | R6,000 |
| R1,000,000 | R2,000 | R6,000 | R12,000 |
| R2,500,000 | R5,000 | R15,000 | R30,000 |
Admin Boss’s free COIDA premium calculator models the assessment from your payroll and industry — useful both for budgeting and for sense-checking the class you were assigned.
Industry classes: where your tariff comes from
The Fund’s tariff schedule groups businesses into classes and subclasses by risk: clerical and professional work at the bottom; retail, hospitality and light manufacturing in the middle; construction, transport, forestry and heavy industry toward the top. Some classes are insured through licensed carriers instead of the Fund — RMA historically covers mining and parts of construction.
Your class is set by your dominant actual activity, declared at registration. ‘Dominant’ matters: a builder with an office full of administrators is still a builder; a software company whose staff occasionally visit client sites is still a software company. Describe the business as it is — not as it is cheapest.
Classed too high, you overpay every year. Classed too low, you underpay — and a claim or audit triggers reclassification with back-assessments. Neither is a strategy; accurate is the only stable position.
The earnings cap and what is assessable
Assessable earnings broadly mirror payroll: salaries, wages, overtime, commission, bonuses and most allowances. A maximum earnings figure per employee per year caps the base — an executive on R2 million does not multiply your assessment by their full package, only up to the cap. Genuine contractor payments and expense reimbursements sit outside the base.
The annual reconciliation matters here: your last estimate is trued-up against your actuals when the new assessment is raised. Under-estimate habitually and every year opens with a catch-up bill; over-estimate and you lend the Fund money interest-free. Declare actuals accurately and estimates honestly.
Auditing your assessment invoice
- ✓Does the earnings figure match your ROE (and your payroll records)?
- ✓Is the tariff class still your real dominant activity?
- ✓Was the per-employee earnings cap applied correctly?
- ✓Does the invoice reconcile last year’s estimate against actuals?
- ✓Are instalments or arrangements from prior years reflected?
Query errors before paying where possible — the Fund adjusts incorrect assessments far more readily than it refunds paid ones. If the class is wrong, request reclassification with a proper description of your activities; expect to motivate it. Admin Boss reviews COIDA assessments as part of the good-standing service and its annual compliance work — the system context is in the COIDA pillar guide.
- Department of Employment & Labour — tariffs and assessments
- Compensation Fund online services
- COIDA — Act 130 of 1993
Always confirm current requirements with the official source — rules and deadlines change.
- ✔COIDA Return of Earnings — request a quote
- ✔RMA Return of Earnings — R450
- ✔Get your Letter of Good Standing back
Frequently asked questions
How is the COIDA assessment calculated?
Total assessable employee earnings for the year (1 March to end February, subject to a per-employee cap) divided by 100, multiplied by the assessment tariff for your industry class. The figures come from your annual Return of Earnings.
What tariff class is my business in?
The class assigned at registration based on your dominant business activity. It appears on your assessment correspondence — if the description no longer matches what the business actually does, request a reclassification review.
Is there a cap on earnings for COIDA?
Yes — a maximum assessable earnings figure per employee per year, adjusted periodically. Earnings above the cap are excluded from the assessment base.
Can I reduce my COIDA assessment legally?
Three legitimate levers: make sure your industry class is accurate, apply the earnings cap correctly, and declare actuals honestly so annual reconciliations do not shock you. Anything beyond that is under-declaration — which converts into back-assessments plus penalties when it surfaces.
Last reviewed: July 2026 · How we research our guides
EmployerGuide.online provides general information about South African employer obligations — not legal, tax or professional advice for your specific situation. Laws, rates and deadlines change; confirm current requirements with the official sources linked above, or ask Admin Boss. See our disclaimer.