What Is a Letter of Good Standing (COIDA)?
Quick Answer
What Is a Letter of Good Standing (COIDA)?
A Letter of Good Standing is the Compensation Fund‘s proof that your COIDA registration, Returns of Earnings and assessment payments are up to date. Tenders, construction sites and corporate supplier contracts require it. Get it by registering, filing your return, paying, then requesting the letter online.
What this means in plain language
In the tender and construction world, this letter is a gate key. It tells the client: if my worker is injured on your site, the Fund pays, not you – and my paperwork proves it.
The letter is only as alive as your compliance. A missed Return of Earnings or unpaid assessment invalidates the standing behind it until fixed.
Who this applies to
- Contractors and subcontractors needing site access
- Any business bidding for tenders or corporate supplier work
Step by step
- Register with the Compensation Fund if not yet registered.
- File the current Return of Earnings (W.As.8).
- Pay the assessment invoice in full.
- Request the Letter of Good Standing through the Fund’s online system.
- Diarise next year – the letter’s value expires with your compliance.
Common mistakes to avoid
- Requesting the letter with an unpaid estimate on the account – it will be refused.
- Photocopying last year’s letter for new bids – clients verify with the Fund.
- Waiting for tender week: an unregistered business needs weeks, not days, to reach good standing.
A South African example
A Polokwane roofing contractor loses site access on day one because his letter expired after a missed return. His bookkeeper files, pays and requests the new letter; he is back on site the following week – an expensive week of idle crews.
Related questions
- What Is COIDA and Do I Need It?
- What Is a COIDA Return of Earnings (W.As.8)?
- Tenders, B-BBEE and CSD: How to Win Government and Corporate Work
- UIF and COIDA: The Complete Employer Compliance Guide for South Africa
Always verify this information with official South African government sources. Rules, fees and thresholds change. Check SARS, CIPC, the Department of Employment and Labour or gov.za before you act.
Frequently Asked Questions
How do I get a Letter of Good Standing?
Register with the Compensation Fund, file your Return of Earnings, pay the assessment, then request the letter through the Department of Employment and Labour’s online system. It is issued only to fully compliant employers.
How long is a Letter of Good Standing valid?
It reflects your compliance at the date of issue, and most clients treat it as current for the assessment year. A new missed return or unpaid assessment undermines it immediately.
Why do tenders ask for a Letter of Good Standing?
It shifts injury risk to the Fund. If your worker is hurt on the client’s site and your COIDA is compliant, the Fund compensates – the client avoids claims against their own project.
Need a Letter of Good Standing urgently? A COIDA service can get you compliant and issue-ready.
Official sources
About BizAnswers: BizAnswers is a privately owned South African company – not a government department. Our guides are free to read and show you how to do things yourself through official channels. If you would rather have the paperwork handled for you, we assist individuals and businesses with filing their South African tax returns and staying compliant, which is a paid service, not a free government service. Contact us for help.
Last reviewed: September 2026 by the BizAnswers editorial team. How we write and check our guides.
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